Shriram Properties will raise up to Rs 1000 crore from Private Equity funds

Shriram Properties will raise up to Rs 1000 crore from PE funds. The funds will be raised in order to launch new residential projects across India. Shriram Properties is a flagship company of Shriram Group.

The land developers also raised funds for its various projects, a year before. It was raised by Rs 900 crore in which Tata Opportunities Fund contributed Rs.468 crore as an entity-level investment. Tata Opportunities Fund is a subsidiary PE fund of Tata Capital Limited whose stakes were picked by 18%.

The Bangalore based developer will craft 3 residential projects in Chennai and 5 in Bengaluru and 1 project each in Coimbatore and Visakhapatnam.

Managing Director of the company, M. Murali said, “We won’t raise capital by diluting stake in the company now, but we will raise at least Rs.1,000 crore this year for a number of new projects that we will launch. We will also use this money to cash out in existing projects and use that money in other projects.”

Shriram Properties has raised Rs.67 crore from India Realty Excellence Fund II which is managed by Motilal Oswal Real Estate Investment Advisors Pvt. Ltd, in what is probably the developer’s first fund-raising activity of 2015.

The capital has been invested for the development of a 19.5-acre, mid-income residential project called Greenfield, located off Old Madras Road in Bengaluru. The project is a joint venture development with Garden City Reality Pvt. Ltd, the landowner from whom Shriram Properties has bought the land.

“We value the investment from Motilal Oswal Real Estate Fund, which has enabled us to unlock the land bank potential and will not only strengthen us financially but also provide us a spring board to launch into the next cycle of our growth,” said Murali.

But Shriram Properties, which was planning an initial public offering (IPO) sometime this year, may just push it to next year now.