Real estate developer Signature Global is set to launch its initial public offering (IPO) on Monday, September 20, with the aim of raising Rs 730 crore ($98 million). The price band for the IPO will be announced in the coming days. The offer, which closes on Wednesday, September 22, includes a fresh equity issue of Rs 603 crore ($81 million) and an offer for sale (OFS) segment of Rs 127 crore ($17 million) by selling shareholder International Finance Corporation (IFC).
The company has reserved up to 75% of the issue size for qualified institutional buyers (QIB), up to 60% of which is reserved for anchor investors who can book shares on Saturday, September 18. The remaining 15% of the issue size is reserved for high-net-worth individuals and 10% for retail investors.
Signature Global, the largest real estate development company in the National Capital Region of Delhi in affordable and lower mid-segment housing in terms of units supplied between 2020 and March 31, 2023, intends to use the net fresh issue proceeds for repaying debts amounting to Rs 432 crore ($58 million), while the rest will be used for inorganic growth through land acquisitions and general corporate purposes.
As of June 2023, the outstanding loans on the books of the company were Rs 495.26 crore ($66 million) and its four subsidiaries at Rs 123.86 crore ($16 million). The company's sales (net of cancellation) have grown at a compounded annual growth rate (CAGR) of 42.46 percent during FY21-FY23 to Rs 3,430.6 crore ($460 million).
Since starting operations in 2014, Signature Global has sold a total of 27,965 residential and commercial units within the Delhi NCR (NYSE:NCR) region, a total saleable area of 18.90 million square feet as of March FY23. Most of its projects are located in Gurugram and Sohna in Haryana, with 88.49 percent of the saleable area located in this region.
Financials furnished in the draft IPO papers show that the company recorded a consolidated net loss of Rs 63.7 crore ($8.5 million) for the year ended March FY23, narrowing it down from Rs 115.5 crore ($15.5 million) a year back, but its consolidated revenue from operations remained strong at Rs 1,553.6, increasing sharply from Rs 901.3 crore.
The IPO is managed by ICICI Securities, Axis Capital (NYSE:AXS), and Kotak Mahindra Capital Company, while Link Intime India is the registrar to the offer.
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