Parsvnath To Go Slow On Land Buys

Parsvnath Developers, the Delhi-based realtor, plans to invest up to Rs 500 crore for land acquisitions in fiscal 2009. However, it will not be aggressive in ramping up its land bank and would acquire land for its projects.
In its latest quarter, the BSE-listed Parsvnath added 66 acres of land.
Pradeep Jain, chairman at Parsvnath, said the focus is to acquire land for setting up integrated townships. “We are not very aggressive in acquiring new land to boost our land bank”.
Jain said, “I think we would invest Rs 400-Rs 500 crore out of internal accruals, depending on liquidity …to acquire land in this financial year”.
The realtor further added that land acquisition for its 8 special economic zone (SEZ) sites is complete. These are at Dehradun, Indore, Kochi, Gurgaon, Nanded, Hyderabad, Mysore and Jaipur.
He said, “Construction for most of the SEZs will start in two months”.
Parsvnath is setting up a 370-acre pharmaceutical SEZ in Nanded, Maharashtra. It is also in advanced talks to sell stake in its SEZ projects to fund its developmental plans.
The realtor is in talks with at least five private equity funds, including Saffron India Real Estate Fund.
The formal announcement for the stake dilution is expected in a month.
The developer plans to build nine five-star and 4 four-star hotels. It also expects to open hotels in Shirdi and Mohali within 9-12 months.
For its retail foray, Parsvnath plans to open five to ten stores with formats including hypermarkets, convenience stores, food joints etc during the current fiscal. It is in talks with a major retailer for a joint venture, and the announcement is expected within a month. Per store costs would be around Rs 3,500-4,000 per square feet.
For its latest quarter, Parsvnath posted a 27% decline in net profit at Rs 73.97 crore from Rs 102 crore a year earlier. Sales fell to Rs 381 crore from Rs 414 crore.

This entry was written by rajani, posted on August 5, 2008 at 3:39 am, filed under Property News and tagged , , , , , , , , , , , , , , , . Bookmark the permalink. Follow any comments here with the RSS feed for this post. Trackbacks are closed, but you can post a comment.

One Comment

  1. riathareja
    Posted August 7, 2008 at 5:14 am | Permalink

    “Buy land, they are not making it any more,” said Mark Twain a long time ago, surely not in India or anywhere else for that matter. But the asset bubble seems to have burst. Blindly investing in real estate thinking that land is finite in supply might not be advisable at the moment. While there will be corrections and recoveries and even growth in certain properties, the time for secular growth is behind us. Therefore, the need to be careful while investing in real estate is important. Now, you could choose the direct method or a via media through several private funds available in India and overseas. But the critical factor to remember is that transparency in India, for real estate deals, is still dismal. The 2008 Jones LangLaSalle transparency index made on a few key factors, namely, performance measurement, market fundamentals, listed vehicles, legal and regulatory environment and transaction process was recently released. While Indian players may have chosen to boost their egos over the fact that our tier 1 cities have shown some improvement, further scrutiny in the matter shows us where we truly stand. While agreeably transparency in these cities have increased over the last two years, where we rank in the world, or even among other BRIC or Asian countries leaves a lot to be desired. If you are investing in funds that are focussed on real estate, you might be presented with some amazing valuation numbers.For more view- realtydigest.blogspot.com

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