Property developer Vijay Shanthi Builders Ltd is planning to raise Rs 65 crore through Non-Convertible Debuntures for Rs 65 crore through Private Placement, from IDFC Real Estate Fund. The company today said that will seek shareholders' approval for issuing NCD.
Explaining about the NCD, the company said, "....your company has plans to source funds from certain Securities and Exchange Board of India (SEBI) recognised real estate funds for its funding needs and in the course of the same, one of such funds, namely, IDFC real estate fund (Herein after known as 'the fund') a category II Alternative Investment Fund has shown interest in funding the company, upto a limit of Rs.65 Crores in form of non convertible debentures (NCD)"
The current stagnation of economy has seriously crippled the fund raising capabilities of companies in property development industry, as the banks and financial institutions have been keeping away from funding the sector due to stringent RBI regulations, it said.
In order to keep developing new projects, more for improving both the top line and the bottom line, the company has to necessarily depend on new types of financial instruments in place of conservative financial instruments such as bank credit in form of working capital cash credit and project term loans, it added.
