Real estate news on HDIL to construct first project outside Mumbai

Builders/ Developers, Investors/ Investment proposal, New projects, Delhi NCR, Hyderabad, Kochi, Mumbai, Delhi-Noida
Posted on May 04, 2012
Mumbai-based real estate firm Housing Development and Infrastructure Ltd (HDIL) will build a 100 acre township in Noida, on the outskirts of Delhi—its first project away from its home turf. The project is crucial for the developer which hasnt launched a single project since last April and requires the much-needed cash flow from fresh projects.

Hari Prakash Pandey, vice-president, finance and investor relations, HDIL, said the Noida project will kick off in the next 8-10 days, as the firm has secured the required approvals.

“The project format has a villa kind of feel, and both plots and villas will be sold,” said Pandey.

In recent times, the company has also spoken about divesting some assets outside Mumbai to exit so-called non-core assets, something that large developers such as DLF Ltd have done. It owns about 170 acres in and around Kochi and another 100 acres in Hyderabad.

Property analysts said HDIL, like many other realty firms, badly needs fresh projects to generate cash flows to repay debt, which stood at about Rs.4,000 crore as of December.

New launches will bring in cash in the form of pre-sales and customer advances, according to Param Desai, research analyst, Nirmal Bang Equities Pvt. Ltd.

Pandey said HDIL will soon launch a residential project in Mumbais Ghatkopar suburb, following the launch of a project last year in the suburb of Mulund. The Ghatkopar project, which will generate almost 0.8 million sq. ft of saleable area, was delayed on account of approvals.

HDIL has to make sizeable repayments in the next 12 months, JP Morgan Asia Pacific Equity Research Report said in March.

“However, given policy issues in overall Mumbai real estate and specifically the airport project, work on the companys ongoing projects has been slow over the last two-three quarters and the deliveries have been delayed,” it said.

As policy regulations gain clarity in Mumbai, the developer has tried to sell assets and development rights of plots to reduce debt in the past year. Analysts estimate this earned the company about Rs.1,400 crore in the past one year. “In the December quarter of 2011, we spoke about reducing our debt by 15% over the following year and we are on track,” said Pandey. “The asset-sale process is also on.”


Source : http://www.livemint.com/2012/05/02221827/HDIL-to-construct-first-projec.html?atype=tp
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