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Marg Constructions lines up mega development plans
Our Bureau
Will raise Rs 270 cr through mix of overseas equity, pvt placement
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Growth strategy
Aims at 10 m sq ft of developed space in 4 yrs
In pact with Singapore co for residential projects
Planning 2 IT SEZs in Andhra Pradesh
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Chennai , Dec. 20
From about one million sq ft of developed space now, a bulk of it for the IT sector, Marg Constructions plans to increase the figure 10 times in the next four years.
This increase will come through a mix of projects - SEZs, a couple of which have obtained in-principle clearance from the Centre, and a few more that it has proposed; a few more IT parks; some major residential projects, including service apartments; and a mall that will also house a multiplex and in the second stage, a budget hotel.
For most of this, Marg Constructions will concentrate on the Old Mahabalipuram Road, Chennai's IT corridor, as the company believes that there is still tremendous growth opportunity in this region.
Also, the company has built up a land bank on this stretch much before it became a hot destination for the IT sector, according to Mr G.R.K. Reddy, Managing Director.
To fund this significant jump in property development, the Chennai-based Marg Constructions will raise Rs 270 crore ($60 million) through a mix of overseas equity and private placement, for which it obtained shareholders' approval in February 2006.
The approval was to raise about Rs 450 crore ($100 million).
Board meet
The company's board will meet on December 23 to review the progress in raising overseas funds and to consider raising funds through private placement or a preferential allotment.
The BSE-listed Marg Constructions on Wednesday closed at Rs 240.60, down from Tuesday's close of Rs 242.85.
According to Mr Reddy, the company will take up a number of residential projects, including service apartments for which it has tied up with Oakwood Asia Pacific Ltd of Singapore, along the Old Mahabalipuram Road.
The ground-breaking ceremony for a mall on the same stretch was held last week.
SEZ projects
The company has obtained in-principle clearance for two SEZs - one for light engineering and another for multi-services - at Seekinakuppam, along the East Coast Road, about 90 km from Chennai. The company has acquired 612 acres for this purpose.
It also proposes to put up an IT/ITeS SEZ at Tirupati and another for building materials at Kodad, about 220 km from Hyderabad.
The company has acquired 100 acres of the proposed 250 acres for this SEZ, Mr Reddy said.
Besides, Marg Constructions has proposed a port-based SEZ at Karaikal in Puducherry. The company is developing the Karaikal port and recently achieved financial closure for this project.
Mr Reddy said that the strategy was to take up each project through a special purpose vehicle - a company created specifically for that project.
It has formed a joint venture called Signa Infrastructure India (P) Ltd with HUDCO to bid for infrastructure projects.
Mr K. Malmarugan, till recently Vice-President (New Initiatives), Tamil Nadu Road Development Company Ltd, has joined Marg to head Signa Infrastructure. Among other projects, Tamil Nadu Road Development Company is improving the Old Mahabalipuram Road.
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