Driven by Qualified Institutional Placement (QIP) issues that was raised by developers, the Indian real estate sector witnessed 25 deals worth USD 1.4 Billion in the September quarter. This was as per reports from Grand Thorton.
The deals marked an all time record with 25 deals in terms of volume and thus remained strong in the quarter. The values recorded were second highest since Q2 2023.
The driving force behind the increase in deal value was QIP activity. This was followed by private equity funding in commercial and residential segments.
8 Deals were reported at USD 51 million in the Merger and Acquisition category.
In PE/VC category there were 12 deals totaling USD 401 million.
A sharp decline was noticed in the private equity funding in terms of values of the deals from USD 1.4 Billion in Q2 to 0.4 billion in the Q3. But still the volume of deals showed consistency indicating towards sustained interest of buyers in small and targeted investments.
According to the consultant, there was 1 IOP (Initial public offering) of USD 49 million and 4 QIP’s at USD 940 million.
The September quarter saw an increase in the capital market activity.
While IOP’s saw consistency with 1 raising of USD 49 Million, the thing which stood out was the increase in QIP activity with 4 deals totaling USD 940 million. These deals were of approximately six times the value in Q2. It owned to one high-value transaction (Prestige estates) which raised USD 602 million as confirmed by the consultant.
The consultant also added that it shows a growth in the confidence of real estate companies to invest in public markets.
According to Grant Thornton Bharat, in the future, the recent irregularity in the Sensex along with capital markets that are broader could temper the enthusiasm of short-term investors.
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