Indian real estate developers scout for FDI

Real estate business in India seems to be hotting up with the government's decision to allow foreign direct investment (FDI) in the sector.

Major conglomerates are taking a plunge and are wooing internationals firms in order to line up investments for major projects.

From the Rs 5,000-crore Godrej Group to Ansals of Delhi, from Raheja's of Mumbai to the Pune-based Vascon Engineers, the infrastructure boom has all these companies scouting for FDI.

"We are mulling a project for constructing software technology parks and for this, we are in talks with certain international companies that can provide us state-of-the art technology. We expect the deal to finalised in the next few weeks."

Dinesh Chandok, chief executive officer and executive director, Ansal Properties & Infrastructure Ltd told Business Standard.

The Raheja group is close on the heels of Ansals with their FDI plans. Vinod Rohira, director, K Raheja Corp, said, "We are receiving enquiries from across the world. It would at least take another six months for things to firm up and stabilise."

In fact, the Godrej group is mulling making real estate its core business. The group is also scouting for international collaborations for its subsidary, Godrej Properties Ltd (GPL).

"FDI in the construction sector is a welcome move. Real estate development would be our core business in the near future apart from FMCG and consumer durables." Adi B Godrej, chairman, The Godrej Group, told Business Standard.

The small and mid-sized companies are also not lost on the charm and prospects of the infrastrcture business. The Pune-based Vascon Engineers, has recently formed a strategic alliance for technological collaboration with Singapore-based Preshcrete Ltd.

As per the strategic alliance, a new joint venture company has been formed named as Vastech Engineers Ltd, which would implement the projects using a new technology called the post pension structure.

"We would share five per cent of the revenue with Preshcrete Ltd for providing us with the technology," says R Vasudevan, chairman and managing director, Vascon Engineers.

Similarly, the Delhi based Media Video Ltd (MVL) is diversifying into real estate business with its new division Media Infrastructure Developers. The company is in talks with a Canadian company, Karwal Developers, Canada, and aims to hike its FDI to tune of around 30 per cent.

"Negotiations are on with Karwal Developers for providing us expertise for the development of real estate project in India. We are looking for both technical as well as financial tie -ups in the form of FDI," said Prem Arishi, managing director, MVL.