The ₹2500 crore initial public offer of Macrotech Developers was subscribed 26% on the first day of the issue.
Macrotech Developers received 9.59 million bids for 36.42 million shares on offer. Qualified institutional buyers portion was subscribed 58% and non-institutional investors portion was subscribed 11%. Retail investors and employees portion was subscribed 15% and 1% respectively.
On Tuesday, Macrotech Developers raised ₹740 crore from 14 anchor investors.
Analysts at Reliance Securities in an IPO note said “Macrotech Developers Ltd’s IPO is valued at 26.3 times FY20 earnings and 4.8 times of FY20 book value, which appear to be reasonably priced vis-à-vis its peers like Godrej Properties and DLF. The company plan is to reduce net debt to ₹12700 crore in the coming quarters negates concern over high leveraging. Further, strong project portfolio and monetization of huge land banks offer comfort. Moreover, its return ratio looks to be superior compared to peers”. Hence, we recommend ‘Subscribe’ to the issue.
The IPO is a fresh issuance of equity shares of ₹10 face value aggregating up to Rs. 2500 crore. The price band has been fixed at Rs. 483 – Rs. 486 per Equity Share.
The company plans to use the IPO proceeds to pare its debt obligations and buy land for future growth.
The Macrotech IPO will be the largest property public issue after DLF, which went public in the year 2007. Its listed peers include DLF, Godrej Properties, Oberoi Realty, Sobha and Sunteck Realty.
Macrotech is primarily engaged in affordable residential real estate developments and in 2019, it entered into the development of logistics, industrial parks and commercial real estate. It is also known for luxury projects such as Trump Towers in Mumbai and Grosvenor Square in London.
This article was first published on livemint.com.