Sobha Developers raises Rs 527 cr through QIP

Construction firm Sobha Developers today said it has raised Rs 526.89 crore through qualified institutional placement (QIP) by allotting over 2.51 crore equity shares of Rs 10 each.

The committee of board of directors took a decision to this effect at its meeting held on Friday, Sobha Developers said in a filing with the Bombay Stock Exchange.

The committee allotted 25,162,135 equity shares at a price of Rs 209.40 per share to qualified institutional buyers aggregating Rs 526.89 crore under the Sebi guidelines, it said.

The share price of Rs 209.40 included a premium of Rs 199.40 as per the Sebi rules under qualified institutions placement, it said.

The QIP issue is apparently aimed at raising fresh capital and bring down its debt burden. The company has an accumulated debt close to Rs 1,850 crore.

Sobha Developers, having land bank of around 3,000 acres, is reportedly actively considering various measures to reduce debt burden. A year ago, valuations of realty companies soared based on their land bank assets.

Now, realtors are looking at various options to cut debt burdens and meet capital requirements for operations with realty prices falling and buying sentiments turning negative.

Shares of the company closed at Rs 225.65, up 0.94 per cent from its previous close on the BSE.