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« Flaws in SEZ Policy Forcing Major Players to Plan Exit | Home | Reliance Retail plans expansion in West Bengal »

Parsvanath Developer Plans to Focus on Existing Projects

Cash-starved real estate major Parsvnath Developers Ltd ( PDL) has decided to go slow on its non- housing projects such as development of special economic zones ( SEZs) and focus on the completion of its existing projects. The New Delhi- based developer through its subsidiary company, Parsvnath SEZ Ltd ( PSL) is to carry out activities to develop and operate SEZs. PSL is to develop 17 special SEZs across 10 states covering an area of over 1,780 hectares ( 4,400 acres) in the next five to seven years. Of these, four SEZs have already been notified.

The company that expects a revenue of over Rs 5,000 crore in the next two and half years is looking to raise about Rs 500- 600 crore this fiscal by selling equity at project level. PSL had raised Rs 115 crore from private equity ( PE) firm Red Fort Capital by selling 22 per cent stake in the 17- acre premium housing project ‘ Parsvnath La Tropicana’ at Civil Lines in North Delhi.

Speaking on the sidelines of a presentation on public- private partnership in the housing sector by the National Real Estate Development Council ( Naredco), Parsvnath chairman Pradeep Jain said, ” The company also plans to cut down its debt to Rs 800- 900 crore by March next year from the existing Rs 1,420 crore. We have put construction of 42 million sq ft on fast track. In the next 25- 30 months, we are expecting to realise Rs 5,300 crore from the sale of these areas.” Jain added the company is about to finalise two PE deals. He further said out of this 42 million sq ft area, around 97 per cent is earmarked for housing. The company has sold 35 million sq ft and expects to sell the remaining area in six to nine months.

“From this 42 million sq ft of saleable area, we expect a total sales realisation of Rs 8,150 crore. The company has received Rs 2,850 crore from the buyers,” he said. Jain added, “Our focus is to create a huge base of internal accruals and retire the debt. In the next two years, we may become a debt- free or very low- debt company.” The company currently has a land bank of 3,400 acres with a saleable area of 193 million sq ft. “Of the total land bank, about 97 per cent is fully paid and we have received all regulatory approvals and licences for about 85 per cent of land,” Jain said.

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