Emami Realty plans to invest Rs 700 cr in 3 years

Emami Realty Private (ERPL), a wholly owned subsidiary of FMCG major Emami, has lined up Rs 700 crore for 10 of its real estate projects in Kolkata, Coimbatore and Hyderabad. The projects will be completed in 2010-11 with an estimated payback period of three years.

Money will be raised partly through internal accruals and partly by borrowing from banks and FDI Funding in FDI compliant projects at a debt equity ratio of 2:1.

In the first phase, ERPL will complete construction of more than 5 million sq ft. It is also looking for joint ventures with local partners wherever necessary.

It is also in the final stage of identifying residential projects in Kharagpur, Asansol, Jamshedpur and Bhubaneswar.

Speaking to Business Standard, Raj Sureka, director, ERPL, said, "We are in the process of building four IT parks, four residential and two retail projects in three locations as of now."

While Coimbatore and Hyderabad are likely to see more bungalows by ERPL, Kolkata will have more apartments.

ERPL is also in the process of identifying the multiplexes that will set up shops in its retail ventures. The company's retail projects will also house offices in the premises.

"We have not yet decided the selling price of our projects because they all are due for completion in 2010-11 and by then real estate prices are likely to stabilise or fall. We will be able to take a final call sometimes in 2009," said Sureka.

ERPL has also roped in some of the world's best architects from both India and abroad. These include Bental of South Africa, Hafeez Contractor, Genesis, and Agarwal & Agarwal.

"For all our projects, we will ensure that proper sewerage treatment facilities, water recycling, and water harvesting are in place. We are also trying to put together more greenery, open spaces and natural light for our projects," added Sureka. Emami floated a wholly owned subsidiary, Emami Realty Private, in May this year to make a foray into the real estate sector.

To ensure that income stream would remain unaffected by cyclical turns in the personal care products industry, Emami first diversified into paper. Next came ballpoint pen tips manufacturing, an entry into the healthcare segment with a hospital and pharmacies, followed by real estate, cement and recently in April, bio-diesel.