Mumbai: Real estate developer Omaxe Ltd is planning to raise about Rs 400 crore through a stake sale to institutions, which is expected to be launched by January, a top company official said on Wednesday.
“It’s (the proceeds) not much required for corporate purposes. Yes, it’s definitely required for retiring our debt,” chairman and managing director Rohtas Goel told Reuters in an interview.
The New Delhi-based company has not yet mandated bankers for the placement, while a final decision on the date and amount would depend on market conditions.
Omaxe expects to reduce its net debt to Rs 1200 crore by the year-end from Rs 1600 crore as of now.
The company would also utilise cash flows from operations to reduce the debt, Goel added.
Omaxe has emerged the lowest bidder for projects worth Rs 250 crore, and expects these to be awarded in a month. Goel, however, did not divulge the specifics of the projects.
The company’s infrastructure orderbook was at Rs 1250 crore as on 30 Sept. Goel expects this to rise to Rs 1700 crore by FY11-end.
“This would be fairly from government projects, from Punjab, Haryana, Uttar Pradesh and a couple of defence projects. These would be basically to construct buildings and these would be purely EPC contracts (engineering, procurement and construction) and not BOT (build, operate and transfer)...,” he said.
The company has posted a 63% rise in consolidated net profit for July-Sept to Rs 367.5 million on a net sales of Rs 354.4 crore.
In July-Sept, the company made fresh sales of 2.39 million square feet, worth Rs 550 crore and land acquisitions worth Rs 700 million, Goel said.
It launched six new projects in the quarter with about 15 million square feet saleable area, he said.
The company’s shares on Wednesday closed up 1.79% at Rs 150.95 in a weak Mumbai market.