Real estate giant Kalpataru eyes deleveraging amid ₹1,590 cr IPO

Real estate firm Kalpataru plans to repay borrowings using IPO proceeds, cash reserves and project sales, with debt ratio targeted to fall from 3.7x to below 2x

Real estate firm Kalpataru is aiming to deleverage its balance sheet by using the proceeds of its ₹1,590 crore initial public offering (IPO), its existing cash balance and estimated future cash flow generated through sales, the company’s management, led by managing director Parag Munot, said.

 

Kalpataru’s net debt stood at around ₹10,120.52 crore as of December 31, 2024. Its debt-to-equity ratio was around 3.7x, which it expects to reduce to below 2x after the fundraise. Of the Rs 1,590 crore the company aims to raise via the IPO, Rs 1,192.5 crore will be utilised for the repayment of borrowings.

 

 

In 2022, the company sold land parcels across Thane and Pune for ₹2,002.6 crore. Between 2023 and 2024, the company’s promoters and members of the promoter group infused ₹1,440 crore through the conversion of unsecured loans into compulsorily convertible debentures (CCDs).

 

On March 27, 2025, the company converted these CCDs into 2.78 crore equity shares at ₹517.25 per share (including a premium of ₹507.25).

 

“As of March, our debt-equity ratio, due to the conversion of CCDs into equity, has already come to 3.7. On the repayment of debt and raising of capital from the IPO, it will go down further below 2x,” said Chandrashekhar Joglekar, chief financial officer, Kalpataru. 

 

He also informed that the company’s cash and bank balance is around ₹800 crore.

 

Further, the company is banking on its project pipeline, out of which 24.83 million square feet (msf) is ongoing, 16.33 msf is forthcoming and 7.8 msf is in the planning stage. It also has land reserves of around 1,600 acres across the Mumbai Metropolitan Region (MMR), Pune and Surat.

 

“In FY26 and FY27, we will be delivering many projects totalling 10 msf. That will generate a lot of net cash or surplus cash, which will be automatically utilised towards debt repayment, bringing down that debt to almost half of what it is today, depending upon how the cash flows pan out. The deleveraging strategy is very clear,” Joglekar added.

 

The company’s IPO will open on Tuesday, June 24, 2025, and close on Thursday, June 26, 2025. The price band for the fresh issue has been fixed between ₹387 and ₹414 per equity share. Bids can be made for a minimum of 36 equity shares and in multiples of 36 thereafter.

 

So far, the company has developed over 120 projects across 10 Indian cities. Its revenue from operations in the first nine months (9M) of FY25 was ₹1,624.7 crore, compared to ₹1,929.98 crore in FY24. The company posted a profit of ₹5.51 crore in 9M FY25, against a loss of Rs 116.51 crore earlier. 

 

The management attributed the earlier losses to the revenue recognition method it follows, under which revenues are recognised only after a project is completed.

 

In 9M FY25, the company recorded sales of ₹2,727.3 crore, compared to ₹3,201.98 crore in FY24.

 

About 92 per cent of the company’s portfolio is in the residential segment, and it aims to continue focusing on this, particularly through asset-light projects such as redevelopment, joint ventures (JVs) and joint developments (JDs). Currently, 25 per cent of Kalpataru’s portfolio comprises asset-light projects, and Munot expects this share to increase.

 

“Redevelopment has seen strong growth now because of the Development Control Regulations (DCR) change. South Mumbai and the suburbs have become viable for redevelopment. It's the right time to go public, because only when you are listed do you have the potential to acquire more projects,” Munot said.