Revival of IPO market to boost realt

A spate of landmark reforms undertaken by the government including RERA, GST,  Liberal FDI Norms, has given a much needed momentum to the fund flows to debt- ridden, cash- starved real estate developers.

These reforms have particularly boosted the confidence of global investors and institutional investors who are now more keen to invest in real estate. This is evident from real estate gaining $257 million of FDI in 2017. The reforms have also bridged the trust deficit of property buyers, with 12 percent hike in home sales in quarter ending March. 

It is not just the investments in physical real estate but also in real estate shares that have picked up in recent past. It’s in this backdrop that developers are now taking to equity market to raise funding. Lodha Group has filed IPO papers to raise over 5000 crore from market. Shriram Properties is also planning a 1000 crore IPO. Says Pradeep Aggarwal, Chairman, Signature Global, ” With the government initiating key reforms like RERA, GST and FDI, investors’ confidence in capital market, has gone up. The  mutual fund awareness campaign has paid rich dividends, with small time retail investors, taking to investment in mutual funds in a well- regulated equity market. I am sure Lodha IPO will prove to be a blockbuster and open up doors for other real estate players to raise capital through the IPO route “.

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