The real estate industry is poised for a significant uplift this Diwali season. At least a dozen public offerings are anticipated, along with a myriad of new projects and the reinvigoration of private equity funds that had previously shunned proposals during last year’s global downturn.
‘After weathering the toughest funds crisis for one and a half years, the realty sector has begun to see a resurgence of capital and fund inflows,’ remarked Anuj Puri, the country head of the prominent global realty brokerage, Jones Lang LaSalle-Meghraj.
Mr. Puri continued, ‘Sales are on the rise and private equity funds are returning to the fold. With market sentiments turning optimistic, the chances of successful fund-raising look even more promising. It's evident now that every company is exploring the Qualified Institutional Placement (QIP) method to gather necessary capital.’
QIP serves as a mechanism for raising capital, wherein a listed company offers equity shares, whether fully or partially convertible debentures, or other securities to institutional investors instead of defaulting back to warrants.
Following a year in which India’s realty sector suffered a staggering loss of around 75% in stock value, the industry has successfully garnered approximately $15 billion (Rs. 750 billion or Rs. 75,000 crore) through various methods, including QIP, over the last six months.
Among the developers actively securing funds in recent months are the industry's top player, DLF Ltd., which has raised $780 million, Unitech with $325 million, and Indiabulls Real Estate fetching $550 million.