Realty firms are cutting or withdrawing on their assessments as in the next three years debt of Rs1.8 trillion will be maturing for India's biggest developers. India's largest builder DLF Ltd is being downgraded by Crisil Ltd. On December 27, Indian unit of standard and poor's climbed to its highest of Rs242.7 billion after its liabilities minus cash. For Unitech limited Fitch rating withdrew its ratings last month. Unitech is the second largest developer to face funding crunch in year 2008 during the credit crises. In last two years the central bank’s monetary tightening record displays the risk of rising defaults in real estate industry of India.
The economic growth has been slowest in year 2009. In a weak economic environment cash flow becomes weak. The financial status of Indian developers can be undermined by high rising debts. Due to delay in reduction of debts ratings remain under threat. It will be difficult to expect development in near future. The rate of central bank was increased to 3.75 per cent made the Indian real estate’s debts costs to rise. Currently the central bank’s repurchase rate is 8.5 per cent which is highest since previous two years.
The economic growth has been slowest in year 2009. In a weak economic environment cash flow becomes weak. The financial status of Indian developers can be undermined by high rising debts. Due to delay in reduction of debts ratings remain under threat. It will be difficult to expect development in near future. The rate of central bank was increased to 3.75 per cent made the Indian real estate’s debts costs to rise. Currently the central bank’s repurchase rate is 8.5 per cent which is highest since previous two years.
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