Bengaluru based realty firm Shriram Properties had plans to target the market with Initial Public Offerings (IPO) this year, but according to the senior official of the land developer, they have to postpone their plans till next year in hope of market sentiments to get improved.
Shriram Properties is looking forward to raise its funds upto Rs 1,000 crore with the help of IPO, by mitigating 20 to 22% stakes of the firm. The realty firm is quite occupied with completing the formalities at the moment. It is also in the process of finalising the merchant banker for the same purpose. After all of it, Shriram Properties will hold the position among the pioneering editors to go public in half a decade. Oberoi Realty and Prestige Estate were the last realty experts to go public and that’s too in 2010.
Managing Director of Shriram Properties, M Murali told the concerned media authority, “We expect the upcoming budget to usher positive sentiments among consumers through tax sops and other incentives, which in turn will drive demand for housing units. We as an organisation are ready for the IPO but we will launch it at a time when general consumer sentiment improves.”
Meanwhile, the company is looking to scoop up around Rs 1,000 crore from private equity investors this year, almost the same amount it raised last year. “There is a lot of enthusiasm among PE community for real estate investment but end users seem to be staying away,” Murali said.
Recently, it sealed a deal with Motilal Oswal PE raising Rs 80 crore for its ongoing project Greenfield in Chennai. Also, in a rare entity level deal, it raised Rs 468 crore from Tata Opportunities Fund last year.
We are looking at raising funds only at special purpose vehicle level this year,” he said.
The Chennai-headquartered realtor Shriram Properties is a part of the Rs 90,000-crore Shriram Group and is present across Bangalore, Chennai, Coimbatore, Kolkata, Visakhapatnam and Hyderabad. It has over 50 million square feet under development.
Its financial partners include TPG, Walton Street Capital, Starwood Capital, ASK Real Estate, Prudential ICICI, Sun Apollo, Amplus Capital, TPG, Sun Apollo among others.