You are using an older browser version. Please use a supported version for the best MSN experience.

Edelweiss Financial starts real estate arm, hires CEO

LiveMint logoLiveMint 09-06-2014 Madhurima Nandy

Bangalore: Edelweiss Financial Services Ltd has set up a new real estate business to offer advisory and investment banking services and has appointed a new chief executive officer (CEO).

Ramashrya Yadav, a former joint chief executive officer (CEO) of Mumbai-based real estate firm Orbit Corp. Ltd, has joined Edelweiss Financial as CEO, real estate practice, investment advisory.

This new business under Yadav will be part of the credit and fixed-income cluster of businesses. Edelweiss functions through four clusters—credit, financial markets and asset management, life insurance and commodities.

The credit business has been funding land purchases as well as scaling of selective high-quality projects. Around 30% of Edelweiss’s business is related to real estate.

With this increased focus on realty, which will be both advisory and transactional in nature, Edelweiss will ramp up its exposure to real estate given the demand for capital and opportunities available in the sector, said Ravi Bubna, managing director and CEO of the credit and fixed-income business.

“There are thoughts of venturing into the real estate fund business as well,” said Bubna. “The plans are at a nascent stage.”

The real estate practice will help Edelweiss ramp up its existing businesses with exposure in the sector and will become a gateway for partnering investors, Bubna said.

This separate line of business aims to not only provide real estate opportunities, but also resolve the challenges faced by both developers and investors, where both will be given end-to-end solutions rather than restricting only to transactions.

In the current scenario, where there is a sharp need for capital by developers, financial services firms are trying to offer them support through different routes of debt, equity and a uniquely structured debt-equity mix.

In a consolidation move of a different kind, the Ajay Piramal group recently merged its private equity (PE) business and lending arm to form Piramal Fund Management Pvt. Ltd to offer real estate firms a full range of services. Instead of the two businesses chasing the same developer, they would now offer a full bouquet of services on a single platform, the management indicated.

Yadav said the key services that developers will be offered include resizing portfolios and strategizing exits, planning capital expansion and helping them enter new locations.

“If we establish a strong advisory portfolio, then new investments will also go stronger,” said Yadav.

In May, Edelweiss Financial said it had acquired Forefront Capital Management Pvt. Ltd, a Mumbai-based asset management company focused on wealthy clients.

“With this move, Edelweiss will probably offer a more serious focus on real estate, and will be more active in this sector than it was earlier,” said Maadhav Poddar, associate director, real estate practice, at EY, a consulting firm earlier known as Ernst and Young.

More From LiveMint

image beaconimage beaconimage beacon