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Shriram Properties launches up to ₹ 700 cr IPO in December

BENGALURU : Shriram Properties Ltd plans a 600-700 crore listing in the second week of December, two people familiar with the matter said to c -italize on the rebound in residential demand and increased investor interest in the segment.

The Bengaluru-based company, which focuses on middle-income housing projects in southern India, has filed drafts with the Securities and Exchange Board of India (Sebi) for up to 800 crore through an initial public offering (IPO) in  -ril. It received  -proval from the market regulator in June.

Shriram Properties is now in the process of submitting an updated draft prospectus to Sebi, said one of the two people who requested anonymity. Once  -proved, the company will proceed with selling its shares, the person said.

“Shriram Properties intends to provide partial exits to its four existing investors – TPG C -ital, Starwood C -ital, Tata C -ital, and Walton Street C -ital and Starwood C -ital. Part of the proceeds will be used to pay off debts, “said the second person.

The four investors hold around 58% of Shriram Properties, part of the Indian Shriram Group. The person didn’t say how much stake the four investors would sell in the IPO.

“The company has had a positive response from potential anchor investors, mainly domestic mutual funds and overseas institutional investors,” the person said.

A spokesman for Shriram Properties did not respond to inquiries.

This would be the second real estate company listing after Macrotech Developers Ltd. 2,500 crore IPO in  -ril.

Real estate analysts said investor interest in the residential real estate sector has rebounded significantly. Lower lending rates, people’s preference for larger homes during the pandemic, and changing consumer preferences for owning a property have all fueled demand.

“Institutional investors have stayed away from the housing sector for many years. But that changed during the pandemic, and we’re seeing a steady recovery in sentiment among homebuyers as well as investors. If the sales and project start-ups go on as before, the industry will also experience a comeback from investors ”, demanded a real estate consultant for anonymity.

As a sign of strong investor interest, Macrotech Developers based in Mumbai, which uses the brand name Lodha, 4,000 crore in November through a Qualified Institutional Placement (QIP) from overseas and domestic institutional investors. The QIP, the largest to date by a property developer in India, came just six months after Macrotech went public. While Macrotech gets almost half of its sales bookings from affordable and mid-range segments, Shriram also focuses on budget  -artments. Analysts said investors are bullish in this segment as it accounts for a sizeable share of total home sales.

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