Piramal Fund Management invests Rs2,320 cr in Lodha Group’s projects

Piramal Fund Management (PFM) has invested Rs2,320 crore across several projects of Lodha Group in Mumbai, in what is seen as the single largest debt transaction in the real estate space.

This is the second investment by PFM in the Lodha Group, after the real estate focused fund invested Rs425 crore in Lodha Venezia, an advanced stage project in Mumbai.

PFM is a Piramal enterprises, controlled by billionaire Ajay Piramal, while Lodha Group has been India's largest real estate developer by sales for four consecutive years.

The Rs2,320 crore financing would be used to service debt across various projects. This funding will enable Lodha to complete and deliver marquee projects in South and Central Mumbai.

''I am pleased to have furthered our relationship with the Lodha Group. This transaction demonstrates our ability and willingness to scale our financing relationships with our choice of partners and stands testament to the marketing and execution track record demonstrated by Abhishek (Lodha, MD, Lodha Group). The use of proceeds will ensure completion of what we believe to be marquee projects in Central and South Mumbai,'' Khushru Jijina, managing director at Piramal Fund Management said.

The deal has been structured as a fixed return debt investment with periodic coupon payments and has an appropriate security mechanism in place, including hard asset cover as well as an escrow of receivables.

''We are seeing momentum building up in our business with sales, deliveries and collections all moving up. This transaction will further strengthen our balance sheet and give us room to further improve our growth. We are pleased to have deepened our relationship with PFM and look forward to a long-term engagement with them,'' said Abhishek Lodha, managing director at Lodha Group.

Lodha Group recorded gross sales of over Rs8,000 crore in FY16, sustaining market leadership and unparalleled growth across market cycles.