MUMBAI – Mahindra Lifespace Developers Ltd, a notable player in the real estate sector, might look into securing private equity funding for select projects. However, a senior official clarified that there are no immediate intentions to dilute the company's stake. Arun Nanda, the Vice-Chairman, addressed analysts late Tuesday, noting that while the Mumbai-based firm may require additional funding for a planned special economic zone in Maharashtra and future townships, there’s currently sufficient liquidity for ongoing ventures.
The company is well known for its extensive development of a 1,400-acre special economic zone (SEZ) in Chennai. Moreover, plans are underway for its second SEZ, spanning 3,000 acres in Jaipur, which is slated to commence operations by July 2008. Nanda shared that, "Chennai has started generating cash, while Jaipur is self-sufficient. When we go to Maharashtra, we will need to look for funds."
Additionally, Mahindra Lifespace has conceptualized a sizable 3,000-acre multi-product special economic zone located at Karla, near Pune. Although they have already obtained necessary approvals, the process of land acquisition is expected to begin only later this year, as per Nanda's comments.
In terms of equity, Nanda emphasized, "There is no intention for Mahindra group to dilute equity. At best, we might bring in some private equity." He proudly stated that the company is operating at a zero-debt level and currently boasts cash reserves amounting to 250 crores (2.5 billion rupees).
The Mahindra group maintains a 51 percent equity stake in Mahindra Lifespace. Recently, the firm established a joint venture with private equity fund ARCH Capital focused on developing a 55-acre township project within the Chennai SEZ. Furthermore, Mahindra Lifespace has earmarked an investment of 5 billion rupees for a 25-acre residential endeavor in Nagpur. They are also contemplating four additional large integrated township projects, although Nanda withheld detailed information about these initiatives.