Real estate developer Ekta World has given exit to private equity firm Sun AREA Property Partners for Rs 256 crore ($38 million) on an investment of Rs 135 crore ($20 million).
The Economic Times reported that Sun AREA Property Partners made a nearly two-fold return on its investment in Ekta World's luxury residential project, Ekta Tripolis, in the Goregaon suburb of Mumbai.
The realty focused investment firm, previously known as Sun Apollo, had put in Rs 135 crore in tranches between 2011 and 2013. "We have provided exit to both our private equity partners... HDFC PMS and, now, Sun AREA. We have managed to provide these exits totaling nearly Rs 570 crore even during the tough market conditions," the report quoted Ashok Mohanani, chairman of EKTA World.
“In the last two quarters, we have managed to record sales worth Rs 400 crore and this has helped us in providing an exit to Sun AREA,†he added. A Sun AREA executive confirmed the development, the report said.
This was one of the few equity deals that had taken place during the time. Most of the transactions over the years have shifted to debt with PE firms turning into lenders and NBFCs ramping up their focus on the sector.
Equity deals, considered risky, have gone down considerably as the real estate market tanked. But with green-shoots now visible and the economy showing signs of improvement, equity corpus is slowly making a comeback. HFDC Capital, the real estate investment arm of HDFC Group, alone will pump in over Rs 5,000 crore equity money in real estate in 2-3 years.
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