April 27, 2018

The Mumbai-based realty firm filed its draft red herring prospectus (DRHP) with markets regulator Sebi, sources said.

MUMBAI : The Lodha Group is looking to raise more than Rs 5,000 crore through an Initial Public Offering (IPO), marking the return of India's largest-selling property company to the capital markets after a nine-year gap that it used to establish its credentials in Mumbai, Pune, and downtown London.

Three persons with direct knowledge of the proposed issue told that Rs 3,750 crore will be raised through issuance of fresh shares, while the balance will come in through offer for sale. On Thursday, Lodha Developers filed the draft red herring prospectus for the issue.

"A significant portion of issue proceeds will be utilised to repay the developer's debt that stood at Rs 17,000 crore as of December end," said one of the persons cited above.

The proposed IPO is likely to be launched in the next 3-4 months. The company has hired CLSA, Kotak Investment Banking, Morgan Stanley and JM Financial as the lead bankers for the issue.

An email query to Lodha Group remained unanswered until the time of going to press.

In an exclusive interaction in early 2017, Lodha Group's MD & CEO Abhishek Lodha had told ET that the company was expected to go public in the next 12 to 18 months.

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.

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 clocked new sales of Rs 6,966 crore for the last reported full year of 2016-17, and Rs 5,482 crore for nine months ending December 31, 2017 in India.

The company is currently developing several projects such as Lodha Altamount, the World Towers, Trump Tower Mumbai, One Grosvenor Square, and Palava City, among others. As of December end, Lodha Group had 37 ongoing projects across London, Mumbai Metropolitan Region (MMR) and Pune property markets.

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. Lodha is developing a total of 33.8 million sq ft across commercial and residential projects.

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.

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Source: realty.economictimes.indiatimes.com