Indian developer Emaar MGF Land plans to cut its initial public offering to about Rs20 billion ($430 million), half the size it announced earlier this year, two sources with direct knowledge of the matter said.

Emaar MGF, a joint venture between Indian lender MGF and Dubai's Emaar Properties, is cutting the size in hopes to attract more investors amid slackening real estate demand and a glut of property firm IPOs in the pipeline.

Emaar MGF's parent is best known for having built the world's tallest tower, the Burj Khalifa in Dubai. Emaar MGF plans to seek approval later this month from the stock markets regulator and hopes to hit the market before the end of the year, the sources said.

The stake dilution by existing shareholders is expected to come down although the company hopes to maintain valuations at the earlier level, one of the sources said. An Emaar MGF spokeswoman in New Delhi declined to comment.

Emaar MGF announced in April it hoped to launch a $770 million IPO within 90 days, but has been stymied by an indifferent stock market and slowing property sales after a sharp run in prices this year.

The company had been the first major casualty of a stock market slump in early 2008 that forced it to abandon its over $1.5 billion IPO in February that year.

The New Delhi-based property firm heads a long list of Indian developers waiting to tap the stock market.

Since mid-2009, at least 16 developers had planned IPO's to raise about $6 billion, but only three have hit the market so far.

Some offerings  still waiting to hit the market include a $600 million issue by Lodha Developers, a $650 million IPO by Sahara Prime City and a $325 million offering by Oberoi Realty.

Emaar Properties said earlier this year it would focus on mid-income housing in emerging markets and overseas expansion to boost 2010 revenue. It is 31.2 per cent-owned by the Dubai government.

Kotak Mahindra, RBS, Deutsche Bank, UBS, HSBC and ICICI Bank are the arrangers to the Emaar MGF offer.-Reuters