Equirus Capital advises VBHC Value Homes in raising strategic minority equity from Daiwa House

VBHC Value Homes Pvt Ltd, co-founded by former Mphasis chairman Jaithirth Rao and former CITI Bank senior official PS Jayakumar, has announced a strategic minority equity fund raise from Japanese real estate conglomerate Daiwa House Industry Co., Ltd., making it the first Japanese investment in affordable housing in India.

The Japanese conglomerate is into the developing of residential, commercial & institutional buildings, smart towns, rental housing, stores, logistics facilities and eco-friendly buildings while Bangalore-based VBHC is a leading affordable housing developer in the country, launched with a vision to build one million homes in the urban areas in the next 10 years. The funds raised would be used for expanding VBHC's project portfolio. No existing investor has exited in this round of investment.

Equirus Capital acted as exclusive advisors to VBHC for the fund raising.

VBHC follows a manufacturing approach for construction to ensure high quality and rapid construction at lower costs by using standardized/modular apartments design and 'Form' construction technology. The Company counts Carlyle, IFC, Caspian and StichtingVan Herk as its current investors.

According to the August 2015 report by Cushman and Wakefield, the affordable housing in India presents a US$11.8bn opportunity across the seven cities of Bnagalore, Chennai, NCR, Hyderabad, Kolkata, Mumbai and Pune. The affordable house demand across these seven cities is around 535,400 units.

Commenting on the transaction, Mr. Jaithirth Rao, Chairman of VBHC, said "The investment marks the continuous faith that the investors have showed in our Company and its brand name VBHC. And now we are happy to partner with Daiwa House, one of the largest homebuilders in Japan, who will help VBHC achieve its next scale of growth through their expertise."

Speaking on the occasion, a Daiwa House spokesperson said "Partnership with VBHC is a part of our business strategy to expand our global operations. And their corporate philosophy in providing affordable housing for all is an ideal fit to that of ours. We look forward to working with their well-acknowledged professional management team."

Mr. Ajay Garg, Managing Director of Equirus Capital said "The investment is a testimony to the growing private sector interest in affordable housing space in India post the announcement of Government's ambitious "Housing for All by 2022" initiative."

Source : Equity Bulls

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