Nov 14, 2022
By: Bhakti MakwanaKeystone Realtors, which operates under the brand ‘Rustomjee’ opened today on November 14, and will close on November 16. The price band of the IPO is set at ₹514-541 a share.
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Keystone Realtors plans to raise ₹635 crore through the IPO – ₹560 crore of it through a fresh issue of shares and ₹75 crore through an offer for sale by promoters and existing shareholders.
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The company is in the business of real estate construction, development and other related activities in India. As of June 30, 2022, it had 12 ongoing projects and 21 forthcoming projects across the Mumbai Metropolitan Region (MMR), under affordable, mid and mass, and some premium categories.
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“With a strong brand and upcoming construction opportunities, we believe it is well placed, and as a result, we recommend that Keystone Realtors Ltd IPO be rated 'SUBSCRIBE',” said a report by KRChoksey Research.
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“In the view of leading position in the Mumbai Real estate market, strong pipeline of ~35mn sq. ft. of saleable area, strong track record with decent financials, and attractive valuation, we recommend ‘SUBSCRIBE’ to the issue,” said analysts at Reliance Securities.
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IPO proceeds will be utilised towards debt repayment, funding acquisition of future real estate projects, and general corporate purposes.
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Further, total borrowings of the company increased to ₹1,557 crore in FY22 from ₹1,220 crore in FY21. The company added that the development of real estate projects involved significant expenses, a large part of it funded through financing from banks and other financial institutions.
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The company mentioned in its RHP that it may face issues in raising additional loans. “Moreover, certain of our loan documents contain provisions that may limit our ability to incur future debt, make certain payments or take certain actions,” it said.
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In FY22, the real estate company’s net profits slumped 41 per cent from a year earlier to ₹136 crore while revenue rose 50 per cent to ₹1,269 crore.
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Lodha group company Macrotech Developers, Godrej Properties are among the company’s competitors.
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The company’s shares are scheduled to be allotted on November 21 and the stock will be listed on November 24 on the exchanges.
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