Lanco lines up Rs 10,000 cr for realty business

Hyderabad-based infrastructure major Lanco Group is planning to invest Rs 10,000 crore in the next five years in its real estate business.

"In next five years, we will be delivering 50 million square feet of space, which will be mainly residential. We plan to invest Rs 10,000 crore in realty business during this period," said L Madhusudhan Rao, group chairman, Lanco.

The company has already bagged a Rs 3,500 crore project - Lanco Hill - from Andhra Pradesh Industrial Infrastructure Corporation, he said, adding that construction would start this month and will be completed in about five years.

"Lanco Hill is a mixed project comprising commercial residential, shopping, hotel and entertainment space covering 18.5 million square feet of built-up area," he said.

Besides, the company is planning to develop many other projects in Hyderabad, Bangalore, Chennai and other smaller cities in south India, Rao said.

Asked about the sources of financing the investments, he said it would be done through internal accruals and advance against sales, with little contribution from the equity side.

With focus on infrastructure, power, realty, construction sectors, the Lanco Group is aiming to achieve a turnover of Rs 8,000 crore by 2010 from Rs 1,200 crore in 2005-06.

Lanco Group, which is currently restructuring its business to bring its realty, power and construction companies into one entity named Lanco Infratech, is also bidding for two road projects of National Highways Authority of India (NHAI) worth Rs 350-400 crore.