In a bid to pursue value accretive projects in its focus markets, Arvind SmartSpaces Ltd (ASL), the real estate company of Arvind Group, has raised Rs 85 crore through HDFC Capital Affordable Real Estate Fund-1 (H-CARE 1).
The Board of Directors of ASL on Friday approved the allotment of 6.85 million equity share aggregating to about Rs 85 crore to H-CARE 1 and the promoters of ASL at the price of Rs 124 per share as per Sebi ICDR Regulations 2018.
Having grown its project portfolio over the last few years, the company will strengthen its balance sheet and provide impetus to its growth initiatives with the equity raised in this round.
According to Kamal Singal, MD and CEO of Arvind SmartSpaces, the equity infusion comes at a time when organised developers with long-term and organised capital like ASL are in a position to deliver customer centric products and solutions on a sustainable basis.
"This partnership will not only provide resources to pursue growth but also help in building the business further by leveraging the brands and legacy of trust that both the partners bring to the business. The company feels that there is a huge opportunity in real estate development in India especially in the post pandemic era," Singal added.
Commenting on the investment, ASL Chairman Sanjay Lalbhai said that the infusion of long term patient capital into the company will give it the flexibility to pursue strategic growth across all the segments that it operates in. "The enhanced equity base and low leverage gives the company significant headroom to raise further capital to pursue value accretive opportunities," said Lalbhai.
On its part, HDFC Capital Advisors Limited's latest investment is an extension to its existing partnership platform set up in 2019 with Arvind SmartSpaces, said its MD and CEO Vipul Roongta.
According to Roongta, the investment meets HDFC Capital Advisors' objective to provide long-term, equity and mezzanine capital to marquee developers for the development of affordable and mid-income housing in India. "This is in line with HDFC Capital’s strategy of partnering with top rated developers with a good track record of development and delivery," Roongta added.
The conclusion of the transaction is subject to necessary approvals from the shareholders of ASL and SEBI. Metta Capital acted as the exclusive financial advisor to ASL for this transaction. Wadia Ghandy acted as the legal counsel to ASL for this transaction & AZB acted as the legal counsel for HDFC Capital Advisors Limited.