Representational image/IPO
Representational image/IPO

Realty major Macrotech Developers Ltd, erstwhile Lodha Developers, on Tuesday raised Rs 740 crore from anchor investors, ahead of its initial public offer (IPO) that will hit the capital market on Wednesday.

Mumbai-based Macrotech has raised Rs 740 crore from 14 anchor investors, the company said in a regulatory filing.

The company informed that it has allocated 1.52 crore shares at Rs 486 per scrip to anchor investors. The price band was fixed at Rs 483-486 per share.

As many as 12 foreign portfolio investors participated in the anchor. The FPIs are Capital Group; Nomura; Ivanhoe Cambridge, real estate arm of CDPQ; Wellington Asset Management; Abu Dhabi Investment Authority, Abu Dhabi's sovereign fund; Platinum Asset Management, Marshall Wace, Brookfield Asset Management, Segantii, York, Oxbow and Discovery.

These investors were allocated approximately 1.45 crore shares for approximately Rs 705 crore.

Two domestic investors, including one mutual fund, were allocated about 7.3 lakh shares for about Rs 35.3 crore.

The domestic investors are HDFC Mutual Fund and Premji Invest, India's largest family office.

Macrotech Developers will launch IPO to raise Rs 2,500 crore through fresh issue of shares. The issue will close on April 9.

From IPO proceeds, Macrotech mainly proposes to reduce debt by up to Rs 1,500 crore and acquire land or land developmental rights aggregating up to Rs 375 crore.

Real estate industry expert Ramesh Nair, who was former CEO of JLL India, said the Lodha IPO could generate significant interest with residential sales significantly improving across the country over the last six months driven by low-interest rates and pent up demand.

"With two successful REIT listings (Mindspace and Brookfield) and two of the biggest ever office portfolio deals (Blackstone-Prestige and Brookfield-RMZ), 2020 was probably the best year for commercial capital markets," he mentioned.

Anuranjan Mohnot, Managing Director & CEO, Lumos Alternate Investment Advisors, said the upward momentum in real estate particularly, residential real estate, is quite visible in sales data of all prominent listed real estate developers in India.

Most of the systemic pain in real estate is behind us and real estate is now looking like one of the preferred investment avenues for investors, he added.

"Listing of new organised players, the listing of REITs, new AIFs etc can provide many more opportunities to investors to ride on Indian real estate growth story," Mohnot said.

On Monday, Macrotech Developers MD Abhishek Lodha expressed confidence that its IPO will be successful given the response that the company has been receiving from domestic and global investors in pre-IPO roadshows.

This is the third attempt by Lodha Developers to launch a public issue and list its shares on the stock exchanges. In 2009 and 2018, the company had filed IPO documents and also got Sebi approvals but did not hit the capital market as market conditions were not conducive.

Macrotech Developers revenue from operations stood at Rs 9,580 crore in the 2019-20 fiscal. In the first nine months of the last fiscal, revenue stood at Rs 2,920 crore.

The company posted a profit of Rs 1,210 crore in 2019-20 but has suffered a loss of Rs 260 crore in the April-December period of last fiscal due to the pandemic.

Macrotech Developers sales booking stood at about Rs 6,600 crore in 2019-20. In the first nine months of last fiscal year, sales bookings stood at nearly Rs 3,400 crore, of which around Rs 2,500 crore was achieved in the October-December quarter.

Lodha Developers, now renamed Macrotech Developers, was founded in 1995 by Mangal Prabhat Lodha.

As of December 31, 2020, the company has completed approximately 77.2 million square feet of developable area across 91 projects.

It has 54 ongoing and planned projects having approximately 73.8 million square feet of developable area.

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