InvestorQ : Do you see the private sector also monetizing assets in the coming year?
Crowny Pinto made post

Do you see the private sector also monetizing assets in the coming year?

8 months ago

If the government is monetizing assets, then the private sector cannot be too far behind. In fact, it is estimated that in the coming years the big contribution to funding will not come just from equities and debt but also from monetizing of existing assets. Broadly, private sector could see monetization happening through the real estate investment trusts or REITs and the monetization of telecom assets.

REITs have attracted interest in India since Embassy launched its first REIT in 2019. However, there are only 3 REITs listed in India today. But, the potential is huge, if you go by the projections of JLL. In fact, JLL projects 284 million SFT of potential business space to be securitized for around $36 billion via REITs. Even if this partly viable, it could be the biggest source of value unlocking that realty companies could see in India.

Telecom in private sector has been the most amenable to monetization. Bharti Airtel, Vodafone and Reliance Jio have already successfully monetized part of their tower holdings in the past. Bharti will be looking to partially hive off the tower business in Africa across Madagascar, Malawi, Chad and Gabon. In the next few years, the major source of funds will be monetization of cash flows. That may be big funding trend in coming few years.