Bengaluru real estate firm Sobha Ltd will launch its rights issue on Friday to raise up to Rs 2,000 crore, primarily to reduce debt, purchase land and machines and meet construction costs of its various projects.
The edition will close on July 4.
On June 12, the Board approved the terms of the rights issue.
The Bengaluru-based company would issue 1,21,07,981 equity shares each partially paid up to Rs 2,000 crore.
The price fixed for the rights issue is Rs 1,651 per share (including a premium of Rs 1,641 per share).
The rights ownership ratio has been fixed at 6 entitled equity shares for every 47 fully paid-up equity shares of the company held by the eligible equity shareholders of the company, as on the record date.
As far as the objects of the issue are concerned, the company has proposed to utilize Rs 905 crore for full or partial repayment or prepayment of certain loans.
The company plans to utilize Rs 212.35 crore to fund certain expenses related to ongoing and future projects.
It will use Rs 210 million to purchase equipment and machinery and Rs 658.58 million to purchase land parcels, according to the offer letter.
In May, Sobha Ltd chairman emeritus PNC Menon had said the company would raise its share capital four times to Rs 10,000 crore over the next five years to support future expansion plans and would launch a rights issue to raise around 2,000 crores.
Sobha Ltd is part of the Sobha Group, founded by PNC Menon in 1995. The Group has real estate business in Dubai under an entity called Sobha Realty.
"We want to raise the capital of the company. So the objective of the rights issue is to provide money to the company so that we can fund the growth," Sobha Ltd Chairman Ravi Menon had said in an interaction last month on Dubai.
After the rights issue to the eligible shareholders of the company, the equity capital base would increase to Rs 4,500 crore from the current Rs 2,500 crore.
Promoters holding 52 per cent stake in the company would participate in the rights issue.
Sobha Ltd's long-term goal is to increase share capital to Rs 10,000 crore in the next five years.
"So over a period of time, within the next 4-5 years, we should have a capital of Rs 10,000 crore. And we are reasonably disciplined with debt," said PNC Menon, 76, chairman emeritus of Sobha Ltd . and president of Sobha Realty.
"...as development happens, you start making profits and that comes back to capital," Ravi had said.
Sobha Ltd has chalked out an aggressive expansion plan and will soon enter the Mumbai luxury real estate market as it looks to achieve a more than four-fold increase in annual sales bookings to Rs 30,000 crore in the next 4-5 years.
The company had recorded a 28 per cent growth in sales bookings during the last financial year to Rs 6,644.1 crore from Rs 5,197.8 crore in fiscal 2022-23.
Sobha Ltd is exploring all options to acquire land parcels in the Mumbai region, including direct purchases, joint development with landowners and redevelopment of existing housing societies.
"Our business in India, Sobha Ltd, will enter the Mumbai market. I have a dream: we have to show something that India has not seen. We are going to follow the same methodology that we use here. When you do it, it will become expensive, the cost will increase. The only place in India that can afford it is Mumbai," PNC Menon had said.
Sobha Ltd was listed on the Indian stock exchanges in 2006 and is one of the leading players in South India. It has presence in the Delhi-NCR market.
The edition will close on July 4.
On June 12, the Board approved the terms of the rights issue.
The Bengaluru-based company would issue 1,21,07,981 equity shares each partially paid up to Rs 2,000 crore.
The price fixed for the rights issue is Rs 1,651 per share (including a premium of Rs 1,641 per share).
The rights ownership ratio has been fixed at 6 entitled equity shares for every 47 fully paid-up equity shares of the company held by the eligible equity shareholders of the company, as on the record date.
As far as the objects of the issue are concerned, the company has proposed to utilize Rs 905 crore for full or partial repayment or prepayment of certain loans.
The company plans to utilize Rs 212.35 crore to fund certain expenses related to ongoing and future projects.
It will use Rs 210 million to purchase equipment and machinery and Rs 658.58 million to purchase land parcels, according to the offer letter.
In May, Sobha Ltd chairman emeritus PNC Menon had said the company would raise its share capital four times to Rs 10,000 crore over the next five years to support future expansion plans and would launch a rights issue to raise around 2,000 crores.
Sobha Ltd is part of the Sobha Group, founded by PNC Menon in 1995. The Group has real estate business in Dubai under an entity called Sobha Realty.
"We want to raise the capital of the company. So the objective of the rights issue is to provide money to the company so that we can fund the growth," Sobha Ltd Chairman Ravi Menon had said in an interaction last month on Dubai.
After the rights issue to the eligible shareholders of the company, the equity capital base would increase to Rs 4,500 crore from the current Rs 2,500 crore.
Promoters holding 52 per cent stake in the company would participate in the rights issue.
Sobha Ltd's long-term goal is to increase share capital to Rs 10,000 crore in the next five years.
"So over a period of time, within the next 4-5 years, we should have a capital of Rs 10,000 crore. And we are reasonably disciplined with debt," said PNC Menon, 76, chairman emeritus of Sobha Ltd . and president of Sobha Realty.
"...as development happens, you start making profits and that comes back to capital," Ravi had said.
Sobha Ltd has chalked out an aggressive expansion plan and will soon enter the Mumbai luxury real estate market as it looks to achieve a more than four-fold increase in annual sales bookings to Rs 30,000 crore in the next 4-5 years.
The company had recorded a 28 per cent growth in sales bookings during the last financial year to Rs 6,644.1 crore from Rs 5,197.8 crore in fiscal 2022-23.
Sobha Ltd is exploring all options to acquire land parcels in the Mumbai region, including direct purchases, joint development with landowners and redevelopment of existing housing societies.
"Our business in India, Sobha Ltd, will enter the Mumbai market. I have a dream: we have to show something that India has not seen. We are going to follow the same methodology that we use here. When you do it, it will become expensive, the cost will increase. The only place in India that can afford it is Mumbai," PNC Menon had said.
Sobha Ltd was listed on the Indian stock exchanges in 2006 and is one of the leading players in South India. It has presence in the Delhi-NCR market.
