Real estate draws domestic venture funds, as telecom lures foreign ones
FVCIs appear to prefer the technology oriented sectors such as telecommunications, information technology and so on
Jun 20, 2013
Source : The Hindu Business Line

MUMBAI: Venture capital firms based in India appear to find real estate projects more lucrative. The bulk of these funds has been parked in real estate projects, according to the Securities and Exchange Board of India data.

Rs 10,000-cr investment

As of December 31, 2012, domestic venture capital funds (VCF) have pumped in Rs 10,159 crore into real estate projects, nearly 10 times the Rs 1,091 crore invested by foreign venture capital investors (FVCI). There are a total of 180 domestic VCFs registered with the market regulator, compared with 154 FVCIs.

Many of the home-grown firms are real estate investment focused, such as the Kotak Mahindra Realty Fund, JM Financial Property Fund, India Realty Venture Capital Fund, India Development and Construction Fund and HDFC Property Fund.

FVCIs appear to prefer the technology oriented sectors such as telecommunications, information technology and so on.

The foreign investors pumped in Rs 6,352 crore in the telecommunication sector that was five-times higher than domestic VCFs’ exposure.

Venture capitalists’ outstanding investments in India witnessed a decline in 2012 from the record levels charted in 2011. The quantum of seed capital provided by domestic and foreign venture capital investors to Indian companies dipped by 2.3 per cent over the course of the year to Rs 55,542 crore.

Cumulatively, VCF investments amounted to Rs 31,556 crore as of December 31, 2012, while FVCIs have invested Rs 33,773 crore. But the VCFs’ cumulative investment includes Rs 9,787 crore of FVCI investment that was routed through the home-grown funds.

Venture capital consists of equity, quasi equity or conditional loan in order to promote unlisted, high risk or high tech firms driven by technically or professionally qualified entrepreneurs. The typical venture capital investment occurs after the seed funding round with a view to generate return through an eventual realisation event, such as an IPO or trade sale of the company.

New classification

Following the notification of the (alternative investment funds) Regulations, 2012, in May last year, new venture capital funds launched in the country will be classified as alternative investment funds. But funds that were registered with SEBI prior to the new rules will continue to be governed by the old rules classifying them as “venture capital funds” till the time they are wound up.

Latest Realty News

Purple Bay makes foray into housing projects at Tirupur
Jun 20, 2013
COIMBATORE: City-based real estate home decors company Purple Bay Foundation today made its foray into housing development projects at the nearby hosiery hub of Tirupur.
New real estate bill is a bitter pill the industry needs for long-term cure
Jun 20, 2013
MUMBAI: The proposed real estate bill, if implemented, will hamper cash flows and escalate the cost of capital of realty firms, besides limiting overall growth of the industry.
How new real estate bill could reshape the realty ecosystem?
Jun 20, 2013
MUMBAI: 1) Project Registration When the Real Estate (Regulation and Development) Bill 2013 comes into effect, all projects will have to be registered with a real estate regulatory authority.
Demand for rental homes down as India Inc turns thrifty
Jun 20, 2013
MUMBAI/DELHI/BANGALORE: Demand for rented homes has halved and rents are down by 25% in several popular residential localities in Mumbai, Delhi and Bangalore, as India Inc tightens housing budgets in its battle against economic slowdown.
Borivali West not viewed as a suburb anymore
Jun 20, 2013
MUMBAI: Borivali West, classified as one of the suburbs of Mumbai, grew by 22 per cent in the Jan-Mar 2013 quarter. The average price of the area today commands Rs 15,200 per sq ft. Properties in places like RM Bhattad Road, one of the best roads in Borivali West, fetch around Rs 18,500 per sq ft.
Crime Branch nabs Seashore boss from Mumbai
Jun 20, 2013
BHUBANESWAR: The Economic Offences Wing (EOW) of State Crime Branch today arrested controversial Seashore Group’s chairman-cum-managing director (CMD) Prashant Dash from Mumbai.
Dilsukhnagar offers wide residential options
Jun 20, 2013
HYDERABAD: A part of the Greater Hyderabad Municipal Corporation, Dilsukhnagar is one of the well developed residential areas of Hyderabad. Markets, educational institutions, coaching and training centers, shopping malls and temples are a part of the established infrastructure.
Focus on high-tech integrated townships
Jun 20, 2013
DELHI: High-tech, integrated residential township projects in metros and Tier I and II cities like the Delhi NCR, Mumbai, Pune, Bangalore, Ahmedabad, Lucknow, Kolkata, Indore, Hyderabad, etc, are promising good returns for prospective buyers and developers.
The Bill will be a boon for homebuyers
Jun 19, 2013
MUMBAI: The Real Estate Regulator Bill which was recently approved by the union cabinet, has been several years in the making now and hasn’t had smooth sailing from the start. Apart from inordinate delays, it faced much resistance from the real estate fraternity at initially who were afraid that this Bill would prove to be yet another regulatory bottleneck, rather than a regulation that would empower the industry and its homebuyers.
Bangalore catches up on sustainable, eco-friendly homes
Jun 19, 2013
BANGALORE: Bangalore has been one of the foremost cities to have warmed up to eco-friendly, sustainable homes. These homes, dotted across localities offer sky-gardens, service core as a buffer area, tropical landscape in the sky gardens, air spaces and wind scoops, natural ventilation, use of cavity walls for insulation, use of natural materials and reduced use of water and power resources.

Latest Realty News Of State

Realty Talk's