This would also be the second-biggest real estate IPO in the country after DLF that had raised around Rs 9,200 crore through its IPO in 2007.
As per the latest update, SEBI has issued observations on the company’s draft red herring prospectus that was filed in April.
Lodha, with its realty projects in Mumbai, Pune and London, is planning to raise up to Rs 5,500 crore through this public issue. Of the proposed issue, it is looking to raise Rs 3,750 crore by issuance of fresh equity shares, while the balance would comprise of offer for sale by the promoters to the tune of Rs 1,300 – 1,800 crore.
The company is likley to raise up to Rs 750 crore out of this issue size through a pre-IPO placement of around 95 lakh shares, said persons familair with the development.
The proposed offering is estimated to value the company at around Rs Rs 38,000 crore and therefore likely to become the largest property company in terms of market capitalization post listing. Currently, DLF is the largest listed real estate developer in the country with market capitalization of around Rs 33,500 crore.
The group is India’s largest real-estate developer in terms of sales and has presence in various cities across the country and in the UK. The company reported revenue of Rs 7,926 crore crore for the last reported full year of 2016-17, and Rs 6,599 crore for the nine months ending December 2017.
Lodha Developers had filed its draft red herring prospectus for the issue in April. This is the second time that Lodha Group has filed papers for an IPO. The Mumbai-based developer had filed a prospectus with the capital market regulator in September 2009. However, it had to withdraw because of weak stock-market conditions.
Of its key markets, most of the company’s projects are in the Mumbai Metropolitan Region, the most expensive real estate market across the country.
As of December end, the developer had 37 ongoing projects, of which 35 projects were in India and two were in London. These projects accounted for a developable area of 33.80 million sq ft, of which 31.95 million sq ft represented projects located in the MMR. It also had 22 planned projects in India with a developable area of 64.21 million sq ft, of which 62.74 million sq ft is located in the MMR.
The proposed IPO will include the company’s consolidated portfolio of commercial and residential projects across all the markets, including two projects in London and its major revenue contributing project of Palava City near Mumbai.
As of December 31, 2017, Lodha has land reserves of about 4,450 acres for future development in the Mumbai Metropolitan Region. It has completed 5,677 homes in 2016-17 and 7,438 homes in the nine months ending December.
The company has hired CLSA, Kotak Investment Banking, Morgan Stanley and JM Financial as the lead bankers for the issue.