South-based privately held realtor Shriram Properties, which was looking to hit the market this year for its initial public offering (IPO), has pushed the plan to next year, saying it is waiting for market sentiments to improve further, a top company executive told VCCircle.
Speaking to VCCircle, M Murali, managing director, Shriram Properties, said, “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."
As first reported by VCCircle, the Southern realtor is looking to raise roughly Rs 1,000 crore through its IPO by diluting 20-22 per cent stake. It is currently preparing groundwork and is in the midst of finalising merchant bankers for the issue.
Shriram Properties would become one of the first pure realtors to go public in almost five years. The last two raising money successfully were Oberoi Realty and Prestige Estate in 2010.
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.
(Edited by Joby Puthuparampil Johnson)