Ashika Capital, which operates under the flagship of Ashika Group offering a wide spectrum of investment banking services, has facilitated Rs 110 crore of debt funding for Mahagun Developers, a leading real estate developer in New Delhi.
The funds will be deployed to cut high pricing on existing NCDs, which Mahagun Developers is planning to prepay. Some fund will also be utilised for general working capital purpose. The transaction was funded by Aditya Birla Finance and was solely advised by Ashika Capital, a Mumbai-based investment banking firm.
In the opinion of Vaibhav Jain, President, Ashika Capital, “In the current real estate scenario, managing cost of borrowing and achieving regular sales with timely delivery of projects are the foremost challenge faced by a developer. This becomes more important considering slowdown and loss of confidence of the end-buyer. We take pride here, to work out best fit financial models for our developer clients and factor-in appropriate pricing and time factor. We currently are mandated by renowned names across the geography, and are working hands-on with their core finance team to achieve desired results. We are focusing on building robust financial model with proper financial closure, keeping in mind the market scenario. Our team expertise, coupled with the market know how, are the reasons for our success. Soon, there will be at least three additional deal closures of cumulative Rs 600 crore plus in another 45 days.
”And, TK Peer, CFO, Mahagun Group, adds, “The chill experienced in the real-estate sector for the last couple of years is not showing any signs of abatement, particularly in the NCR region. High borrowing costs, coupled with unfavourable market sentiment, is squeezing the developers. Thanks to long-term strategic planning and internal controls, Mahagun has not only been able to hold its head above water, but also ensured un-interrupted construction on all its projects. However, we do have embarked on a plan to cut costs, and taken a number of steps in this regard. As a part of this strategy, we have been working closely with Ashika Capital’s team, led by Vaibhav Jain, and successfully completed a deal involving substitution of high-cost debt with low-cost borrowings. It has been a wonderful experience working with Ashika team, and I feel we can together go a long way in our journey of growth.”