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Parsvnath plans to raise up to $67 mn via QIP

The real estate developer had opened its qualified institutional placement last week to raise $60 million, but got subscriptions worth $67 million.

twitter-logo PTI   New Delhi     Last Updated: October 6, 2010  | 13:29 IST

Realty firm Parsvnath Developers is planning to raise up to $67 million (about Rs 300 crore) through private placement of shares to institutional investors for executing its ongoing projects.

Parsvnath had opened its qualified institutional placement (QIP) last week to raise $60 million, but the company got subscriptions worth $67 million, investment banking sources said.

The company's board of directors will meet in a day or two to decide the final amount, they added. The floor price for QIP was fixed at Rs 141.57 a share.

Parsvnath shares were trading at Rs 142.7 a share intra-day on the Bombay Stock Exchange, 2.56 per cent lower than its previous closing.

The company would issue fresh equity shares to investors, resulting in reduction of promoters' share in the company by 5-6 per cent to about 69 per cent.

The company would utilise the funds raised to execute the ongoing projects. It has put construction of 80 million sq ft of area under fast-track out of a total 195 million sq ft of saleable area it possesses.

This is the second round of QIP for Parsvnath in the last one year. In October 2009, the company had raised Rs 168 crore through QIP, mainly to retire debt. It had sold 1.38 crore shares at Rs 121.25 per share.

Besides QIP, Parsvnath had raised Rs 115 crore last year by divesting 22 per cent stake in a housing project located in Delhi to private equity firm, Red Fort Capital.

In another PE deal, the company raised Rs 75 crore from Sun Apollo by selling its stake in a housing project at Gurgaon.

Parsvnath has reduced its debt in the last two years to about Rs 1,300 crore from Rs 2,200 crore.

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