Omaxe to repay Rs 900 cr loan in next few months

Omaxe to repay Rs 900 cr loan in next few months
The Economic Times, February 08, 2009, Page 6

Raja Awasthi NEW DELHI

REAL estate major Omaxe Group, which has a consolidated debt of around Rs 1,500 crore, now plans to repay nearly Rs 900 crore worth of loans in the next few months. Faced with mounting debt obligations, this move is aimed at restructuring high cost loans and comes in the wake of the Reserve Bank of India’s recent decision to allow banks to restructure loans taken for commercial real estate without turning them into non-performing assets.

Says Omaxe Group CMD Rohtas Goel: ”The restructuring would ease pressure on cash flows and enable us to concentrate on execution of existing projects. We are in the process of completing several projects in the coming one year. The company is launching several of its low-cost housing projects on the land bank in its possession which is expected to substantially improve cash flows.”

The company already has bookings for 41 million sq ft worth of space of which it has delivered 4.9 million sq ft. Its target is to deliver another 5.1 million sq ft space in the current financial year to achieve the target of 10 million sq ft.

The group also plans to launch the construction of 10,000 homes in Indore. These low-cost homes will be built as part of a project worth an estimated Rs 1,000 crore. Construction on the development is expected to be complete within the next 18 months and the units are likely to cost between Rs 4 lakh and Rs 10 lakh.

“We will launch 10,000 affordable houses in February on a 200-acre township in Indore. The group has to develop more affordable housing in north India and soon more such projects will be announced,” added Goel.