Kalpataru Group's subsidiary secured ₹525 crore in debt facilities from PAG, a global alternative investment firm. The funds, provided for a term of 3.5 years, are earmarked for the completion of 10 residential towers in a Mumbai suburb, as per sources familiar with the matter.
PAG, through its management of the Asia Pragati Strategic Investment Fund, extended debt facilities to the tune of ₹525 crore in two tranches. This support was structured as non-convertible debentures (NCD) and carried an internal rate of return (IRR) of 18.75%, as indicated by informed sources. Alder Residency, a wholly owned subsidiary of Abhiruchi Orchards, itself a wholly owned entity of Kalpataru, received these debt facilities from PAG.
During the month of November, the Asia Pragati Strategic Investment Fund allocated ₹475 crore towards secured unlisted bonds and an additional ₹49 crore for secured listed bonds. Both sets of bonds are slated to mature on April 30, 2027.
The capital raised through these bonds is earmarked for two primary purposes. Firstly, to retire existing high-cost debt and, secondly, to contribute to the development of Kalpataru Vivant, a residential project featuring ten towers in the suburbs of Mumbai. According to sources familiar with the matter, the estimated project cost ranges between ₹750-800 crore. This strategic financial move aligns with the goal of optimizing costs and advancing the completion of the Kalpataru Vivant project.
The board of Alder Residency had passed a resolution in October to raise ₹620 crore in the form of NCD, the person said.
Parag Munot, the promoter, has personally guaranteed the funds, while Abhiruchi Orchard has provided a corporate guarantee to PAG in connection with the funds raised by Alder Residency. Additionally, the fund holds a primary and exclusive claim, with a first-rank charge, on the registered mortgage and development rights associated with the property.
According to a statement from India Ratings, as of June 2023, Alder Residency has accounted for approximately 24% of the total development cost, encompassing 10% of the overall construction expenses for the project.
As of the end of September 2023, the management has communicated to the rating company that approvals for all eight towers have been obtained, and progress has been made up to the third floor for the remaining two towers.
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