Suraj Estate IPO debuted on the exchange with the discount of 4.5 per cent at Rs 343
Suraj Estate's initial public offering (IPO) remained fragile after a muted debut on the bourse in Tuesday's trading session against the IPO premium listing wind. The stock initiated its exchange journey at Rs 343 or with a 4.5 per cent discount versus its issue price of Rs 360.
Notably, a real estate developer from South Central Mumbai, Suraj Estate received a disinterested response from investors on its first day of bidding 0.77 times and the final subscription stood at merely 16.57 per cent compared to peer Motisons' IPO subscription of nearly 175 per cent.
The Anchor portion, which opened on 17 December, consisting of 33,33,333 shares worth Rs 120 crore was also not oversubscribed.
The timeline for the IPO for the public bidding was 18 December with a price band of Rs 360. Iti Capital and Anand Rathi Securities were the Book Running Lead Managers and Link Intime India was the Registrar of the Issue.
The firm intends to utilise the proceeds for the repayment of outstanding borrowings of the company and its subsidiary, Accord Estates, and Iconic Properties. Additionally, the firm intends to acquire lands and development rights and the other part of the proceeds will be used for general corporate purposes. The issue has also led the promoter's entire ownership in the firm to 74.95 per cent post-issue.
The firm registered revenue of Rs 307.89 crore in FY23, compared to Rs 273.91 crore in FY22. In the first quarter of FY24, the company clocked revenue of Rs 108 crore. The firm's profit after tax (PAT) increased to Rs 32.06 crore in FY23 from Rs 26.50 crore in FY22. Overall, revenue and PAT increased by 12.41 per cent and 20.98 per cent, respectively.
Real estate building company Suraj Estate Developers was founded in 1986. The company works in the South Central Mumbai region to build residential and commercial real estate. The company depends entirely on third-party contractors to complete the construction work on its projects and does not offer any internal construction services.
The firm has developed 42 projects in the South-Central Mumbai area and is currently working on 13 ongoing projects and sixteen future projects. Additionally, over 10 lakh square feet of land in Mumbai have been developed by Suraj Estate.