Piramal Fin to invest Rs 30 bn in affordable, mid-income housing projects

With a focus on affordable and mid-income housing, Piramal Finance (PFL), a unit of Piramal Enterprises, has set up a dedicated team to invest in such projects and has identified an initial deal pipeline of Rs 30 billion.

"Over the past few years, we have been partnering with developers for providing financial assistance, but with this model, we will be able to participate across the entire capital stack," Khushru Jijina, managing director at Piramal Finance told PTI today.

The company has identified an initial pipeline of Rs 30 billion of equity proposals, with transactions across major metros under active consideration, he said, adding, "we intend to scale up to $2 billion by 2020."

The company has identified projects in the Mumbai metropolitan region, Bengaluru and Chennai. It will also look at projects in Pune, Ahmedabad, Surat, Delhi-NCR, Hyderabad and Kolkata.

"We are typically focused on funding projects in the major metros. But for this model, we will also enter the tier 2 cities as these are areas where there is a lot of activity happening on the affordable housing segment," said Jijina.

The company plans to provide both pure and preferred equity capital to top-grade developers that are looking to buy or develop land and need early-stage growth capital.

It may also actively pursue an opportunistic acquisition of land on its own accord and invite developers to participate on a joint-development basis, informed Jijina.

The company is also planning to sanction milestone- linked construction finance for projects through its proprietary wholesale loan book to help developers achieve financial closure for their projects at the outset.

"We believe that our ability is to provide a comprehensive end-to-end solution, including both early stage equity as well as construction-linked debt," he said.