New Delhi: Lodha Developers plans to launch its initial public offering (IPO) in July to raise ₹ 5,500 crore, people familiar with the real estate firm’s plans have indicated. The Mumbai-based developer had on 6 July received the go-ahead for the share sale. The Lodha Developers IPO, if successful, would be the second biggest initial share sale in the real estate sector after DLF Ltd that raised close to ₹ 9,200 crore in 2007.
A spokesperson for Lodha Developers declined to comment on the IPO launch date. Kotak Mahindra Capital, CLSA India, JM Financial and Morgan Stanley India are managing the Lodha IPO.
This isn’t the first time Lodha Developers has planned an IPO. The company had in September 2009 filed the so-called draft red herring prospectus (DRHP) to raise about ₹ 2,800 crore. It had received Securities and Exchange Board of India’s (Sebi’s) approval in January 2010, but later shelved the plan due to unfavourable market conditions after the global financial crisis.
According to Lodha Developers’ latest DRHP, the company will issue fresh shares worth up to ₹ 3,750 crore. The promoters will sell up to 1.8 crore shares through an offer for sale. The firm is also considering a pre-offer placement of up to 95 lakh equity shares for cash consideration aggregating up to ₹ 750 crore, the DRHP said.
Lodha Developers will use ₹ 3,300 crore of the total funds raised from the IPO for debt servicing. It had an outstanding debt of nearly ₹ 18,000 crore as of 31 January 2018.
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The Lodha Group, which was founded in 1995 by Mangal Prabhat Lodha, has completed projects with developable area of 50.49 million sq. ft till December 2017. The company, at present, is working on 37 projects, of which 35 are in India and two in London. These projects account for a developable area of 33.80 million sq. ft, bulk of it in the Mumbai Metropolitan Region.
Lodha entered the London realty market in 2013 and acquired two prime sites in central London for an investment of about £400 million. Lodha UK is eyeing a sales revenue of £1.5 billion (over ₹ 12,000 crore) from two ongoing housing projects in central London.
With inputs from PTI