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The board of real estate company, Parsvnath Developers, has approved a proposal to raise up to Rs 2,000 crore over the next 12 months through Qualified Institutional Placement or preferential share route.
The nod is in the nature of an ‘enabling resolution'.
“The proceeds will be utilised to bring down the company's debt,” the Parsvnath Chairman, Mr Pradeep Jain, said.
The net debt of the company is currently pegged at Rs 1,200 crore, and the company says it has a target of lowering this to below Rs 1,000 crore by the end of the financial year.
The cost of borrowing has increased 100 to 125 basis points over the last one year, Mr Jain said adding that the average interest rate for the debt is around 14 per cent.
In October last year, the company had allotted 1.90 crore shares to institutional investors and raised Rs 269.5 crore through QIP. The funds were utilised partly for retiring debt and rest for execution of ongoing projects.
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