Lodha’s Rs 2.5k crore IPO subscribed 1.4 times

MUMBAI: The IPO for Macrotech Developers (earlier known as Lodha Developers) closed on Friday with the issue subscribed 1.4 times the offer. The portion reserved for institutional investors was subscribed 3.1 times, while the retail investor portion was subscribed 0.4 times and the non-institutional (high net worth investors) category was subscribed 1.5 times. The portion reserved for employees was subscribed 0.2 times.
The Rs 2,500-crore IPO of Macrotech, one of the largest residential real estate developers in the country, had opened on Wednesday at a price band of Rs 483-486 per share. A day before the IPO opened, the company had allotted about 1.5 crore shares to a clutch of foreign and domestic investors to raise Rs 740 crore.
On Friday afternoon, the grey market premium (GMP) for Macrotech Developers was in the Rs 5-6 range, or 1-1.5% of the IPO price. In comparison, some of the recent IPOs had commanded GMPs in the range of 80-100%. Higher GMPs indicate a better listing gain for investors. The stock is expected to be listed in the third week of this month.
At the upper end of the IPO price band, Macrotech Developers will have a market capitalisation of about Rs 21,750 crore. DLF with a market cap of Rs 69,173 crore and Godrej Properties with Rs 37,875 crore are currently valued more than the estimated valuation of Macrotech Developers.
Of the total amount being raised through the IPO, Rs 1,500 crore will be used to reduce the company’s debt, Rs 375 crore for acquiring land and land developmental rights, while the rest will be kept aside for spending on general corporate purposes. This is the third time that the company has been trying to get listed after withdrawing its prospectus in 2009 and then again in 2018.
The 26-year-old Macrotech Developers is a major player in the residential real estate market with its business mainly concentrated in and around the Mumbai metropolitan region. In 2019, it entered the logistics and industrial parks segment as a developer, the company said in the IPO documents. Axis Capital, JP Morgan and Kotak Investment Banking are among the 10 merchant bankers managing the offer.

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