Lodha group gives IPO route a third shot, files DRHP for Rs 2,500-cr IPO

The group's Macrotech Developers plans to use Rs 1,500 crore from net proceeds to repay part of Rs 18,662 cr debt and Rs 375 crore to buy land

Macrotech Developers, earlier known as Lodha Developers, has filed a draft red herring prospectus with the Securities Exchange Board of India (Sebi) to raise Rs 2,500 crore through an initial public offering (IPO).

The company plans to use about Rs 1,500 crore from the net proceeds to repay its debt and Rs 375 crore to buy land.

As of December last year, the consolidated debt of the company stood at Rs 18,662.19 crore.

“(This) will help reduce our outstanding indebtedness, assist us in maintaining a favourable debt-equity ratio and enable utilisation of some additional amount from our internal accruals for further investment in business growth and expansion. In addition, we believe that since our debt-equity ratio will improve significantly, it will enable us to raise further resources at competitive rates in the future to fund potential business development opportunities and plans to grow and expand our business in the future" the company said in its DRHP.

This is the third time Lodha is trying to raise money through an IPO. It had filed its first share sale document in September 2009 to raise around Rs 2,800 crore but shelved the plan in the due to the 2008 global financial crisis.

Lodha later revived plans of an IPO in 2018 to raise around Rs 5,500 crore after receiving the Sebi’s approval but withdrew after a liquidity crisis hit the real estate sector.

As of December, the company had 91 completed projects on a developable area of 77.22 million square feet, with 59.13 million sq ft in affordable and mid-income housing, 12.15 million sq ft in premium and luxury housing, 5.21 million square feet in office space, and 0.74 million square feet in retail. It has 36 ongoing projects with a developable area of 28.78 million square feet.

The company reported a total income of Rs 3,160.49 crore for the period ended December 31, 2020 compared with Rs 9,357.35 crore a year ago. Its net loss stood at Rs 264.30 crore compared to a profit of Rs 503.08 crore.