The Indian realty sector has been facing a cash crunch amid the global financial turmoil. Now, its only saviour the FII money, too, is on the shaky ground. The Big Five at Wall Street are all falling like dominos and for the Indian real estate players that means a big source of fund drying up. The FII money was a savior for most of the developers stuck with big projects lacking funds as debts have been too expensive. Industry sources say over $14 bn in FDI was seen flowing into realty market over next 18 months but now only half may come in.
Of the $10 bn invested in real estate in the last two years, about $3-$3.5 bn from FII. Experts say if foreign funds actually dry up the developers may hold some projects or go for expensive debt and the private equity players may also eye a bigger slice of the real estate players. "There are opportunities in the market," Paresh Chawla, Associate Director, Ernst & Young said. However, at a falling market closing deals are also getting tougher as valuations have plummeted. In one month the real estate index has tanked 45 per cent
Of the $10 bn invested in real estate in the last two years, about $3-$3.5 bn from FII. Experts say if foreign funds actually dry up the developers may hold some projects or go for expensive debt and the private equity players may also eye a bigger slice of the real estate players. "There are opportunities in the market," Paresh Chawla, Associate Director, Ernst & Young said. However, at a falling market closing deals are also getting tougher as valuations have plummeted. In one month the real estate index has tanked 45 per cent
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