IFC and IFC Emerging Asia Fund have entered into an agreement with the Puravankara Group to invest in affordable housing projects.
Ashish Puravankara, MD of Puravankara said that IFC has committed an investment of Rs 566 crore and the first tranche of Rs 300 crore will be for 2 projects.
“The total transaction that IFC has committed is about $73 million that is about Rs 566 crore. The first phase of investment would be about Rs 300 crore into 2 projects; one in Cochin and in Bangalore. The total area of these 2 projects together would be close to about 4.4 million square feet. About Rs 165 crore gets invested by IFC into Cochin and about Rs 135 crore will get invested in the Bangalore project,” he said in an interview with CNBC-TV18.
Puravankara believes that the first investment by IFC will reduce its debt by Rs 150 crore.
He further said that they are expecting a debt reduction of Rs 450-500 crore in the next 12 months.
On sales, he added that both the luxury and affordable housing segment has done well for the company in the last 6 months.
“In terms of the last 6 months, the total sales that we did was close to about 1.5-1.6 million square foot. About 55 percent of that was contributed by our Provident brand which is focused on premium affordable housing and the balance was luxury housing,” Puravankara opined.
Purvankara is looking at launching 11-12 million square foot worth of projects in the next 12 months across Kochi, Bengaluru, Chennai, Pune, and Mumbai.
Puravankara believes that Q3 and Q4 should be equal to or much better than the last 6 months especially when we add the new launches that we have planned.
"Between both the brands, we have about 10-12 million square foot of launches planned over the next 12 months. The broad break up would be about close to 3.5-4 million square foot of new launches under the Purvankara brand and about 7 million square foot under the Provident brand,” he said.
He also said that prices have risen in certain projects by 2-5 percent in the last quarter. “In the last quarter, we took the prices up depending on the project, the location, and the brand. The prices were increased by about 2-5 percent just to absorb some of the increase in cost that we experienced over the last 6 months. So, there has been no reduction in prices, in fact, increases,” he said.