As valuations crumble, PEs, FIIs ready for big realty plunge

Real estate funds, PE players and foreign institutional investors are exploring options to buy equity stakes in listed realty companies, as valuations of these companies have fallen by over 65% during the past three months.

 The move has also come as a blessing in disguise for these realty companies who have been finding it difficult to source funds after the RBI tightened lending norms to property developers following a global liquidity meltdown. Sources said funds floated by majors such as HDFC, ICICI, Kotak and Anand Jain’s Urban Infrastructure Opportunities Fund as well as foreign funds are in talks with listed real estate developers to pick up minority stakes.

Although domestic real estate funds have raised over $2 billion during the past year, a major chunk of these funds is yet be invested. So, most real estate companies are keen to close such deals with the funds, said sources(Read more..)


Source : Economic Times