Century Real Estate has raised a fresh round of funding of ₹520 crore from Piramal Capital, the financial services arm of the Piramal Group.
The funding, which was raised in the first (April-June) quarter of FY 2016-17, will be utilised for its ongoing and upcoming commercial and residential developments, revealed a source on condition of anonymity.
While ₹250 crore will be used as working capital for construction of ongoing projects in Bengaluru, the remaining ₹270 crore will be utilised over the next 12 months for Century Real Estate’s upcoming commercial and residential developments totalling up to 8.5 million square feet of built-up area within 42 acres on Bellary Road and 50 acres on Old Madras Road, said the same source.
This is the third transaction of the Bengaluru-headquartered company with Piramal Capital. The company had raised ₹100 crore from Piramal Capital three years ago, and ₹720 crore last October. After paying off significant chunks of the money raised, Century’s exposure has crossed ₹700 crore with Piramal Capital so far.
Debt liability
On being asked to confirm the fresh funding raised and the company’s total debt liability, P Ravindra Pai, Managing Director, Century Real Estate Holdings Pvt Ltd, declined to comment on the funding; and said Century’s total debt liability at present is ₹650 crore.
In the first quarter of calendar year 2015, Century had borrowed ₹165 crore by issuing non-convertible debentures from ECL Finance Ltd, a subsidiary of Edelweiss Financial Services Ltd, which has since been redeemed, and most of it repaid as well.
“We have delivered 12 projects with 2,500 apartments comprising a total of 2 million sq ft of built-up area and we have 14 projects under development which is a mix of apartments and plotted developments.
“As part of our land monetisation strategy, 50 per cent of our projects fall under plotted developments, which have a quick turnaround time of 9-12 months; while apartments typically take 3-4 years to monetise,” said Ravindra Pai.
Stating that the real-estate market in the country is going through a consolidation phase with many small developers either selling out or going bust, he said: “Homes in the price bracket of ₹50 lakh-₹1 crore are most in demand and that is what we focus on; therefore we don’t see any dip in demand for our product.”
