SBICAP Ventures, which has been entrusted with the task of managing the proposed Rs 25,000-crore real estate stressed asset fund, cleared the first batch of four applications, lending Rs 25 crore each to the realtors.

The fund was created by the government with contributions from financial institutions such as LIC and SBI to complete over 1,600 stalled projects with 4.5 lakh dwelling units.

According to a banking source, more than 100 proposals have already been submitted to SBICAP Ventures by December 31. A source said that seeing the urgency of the matter, banks are working overtime to clear the applications.

SBICAP Ventures has fixed the lending rate at 15% and is lending with a condition that it will have first charge on the future receivables of the company.

Though the fund is lending to a project as the last option, it will be the first one to get its money back when the inflow will start, that is, with the condition of last-in, first-out (LIFO).

Commenting on interest rates, Hiranandani Group CMD Niranjan Hirnandani said though it is a bit on the higher side, at least the fund is made available. So, it is a welcome move. “The sector is facing a tough time because of acute liquidity crunch. So, in this market, cost does not matter much,” he said.

Delhi-based Supertech has also applied for a Rs 1,200-crore loan from the fund for its various projects in Noida and Greater Noida. R K Arora, Supertech CMD, said that due diligence of all the projects is going on and hoped that approvals are likely to come in this month itself. SBICAP Ventures took charge of the fund in November only and asked for proposals from various developers and managers of stalled projects.

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Source: epaper.timesgroup.com

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