India: Developers Shriram, Puranik to refile IPO papers after Lodha

Shriram Properties Pvt. Ltd and Puranik Builders Pvt. Ltd could be next in the queue to launch initial public offerings (IPOs), hoping to exploit a surge in demand for primary market offerings, said three people familiar with the matter.

The two real estate firms will follow Macrotech Developers, formerly known as Lodha Developers, which filed its draft prospectus earlier this week, in its third attempt.

Bengaluru-based Shriram Properties and Mumbai’s Puranik Builders, both residential-focused developers, had filed draft red herring prospectus (DRHP) in the past and also received regulatory clearances for IPOs. Those plans, however, failed to materialize amid a prolonged slowdown in the residential sector, a liquidity crisis and, finally, the pandemic-led disruption. Macrotech’s move, as well as rallying stock markets and a gradual recovery in home-buying sentiment, may have prompted developers to approach public markets again.

Shriram Properties, which received approval from market regulator Securities and Exchange Board of India (Sebi) for an IPO in 2019, is planning to refile its draft share sale documents in March. The firm had in 2018-19 intended to raise 1,250 crore through the IPO, which it cut to 750 crore last year.

“Given the overall optimism in the market, Shriram could raise above 750 crore and will take a call in the next two weeks. It expects to get a clearance sooner, given that there will only be certain tweaks in the earlier DRHP,” one of the people cited above said, requesting not to be named.

Shriram Properties, which focuses on affordable and mid-income housing projects, saw sales recover to pre-covid levels in the December quarter. The company has lined up multiple project launches this year across Bengaluru and Chennai.

Puranik Builders filed a DRHP in 2019-end for an estimated 900 crore IPO. The company received approval from Sebi early last year, which is valid till 31 March.

“The firm has a valid card till March-end and is evaluating if it should launch the IPO by then, and if that doesn’t happen, then file a DRHP again soon after. Last year, due to covid, Puranik couldn’t go ahead and launch the IPO; but now things look better,” the second person said.

Spokespersons at Shriram Properties and Puranik Builders declined to comment.

Mumbai-based Macrotech Developers intends to raise 2,500 crore through its IPO, of which around 1,500 crore will be used to repay debt, while it also intends to purchase either land or land development rights worth 375 crore with the IPO proceeds.

“This is like a window of opportunity for some developers who have been wanting to do an IPO for a while now. Raising capital for residential projects has been difficult, given the challenges the housing sector has faced and with NBFCs (non-banking financial companies) being wary of lending. Even if a couple of IPOs take off, it will be a great confidence booster for the overall sector,” said a Mumbai-based analyst, who didn’t want to be named.

This article was first published on livemint.com.

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Following vacancies can be applied for (only in Singapore).   

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Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.