Sobha Ltd. is launching a rights issue to raise INR 2,000 crore, aimed at reducing debt and financing new projects. The issue, from June 30th to July 4th, offers 6 new shares for every 47 held, priced at INR 1,651 each. The funds will be used for land acquisition, equipment purchase (INR 210 crore), construction costs (INR 212.35 crore), and debt repayment (INR 905 crore). Sobha plans to expand beyond South India and Delhi-NCR, entering Mumbai's luxury market with projects worth INR 658.58 crore. The initiative supports Sobha's goal of increasing annual sales bookings to INR 30,000 crore in five years.
Real estate developer Sobha Ltd. is launching a rights issue to raise up to INR 2,000 crore. The funds will be used to reduce debt, acquire land parcels, purchase equipment (INR 210 crore), and cover construction costs for ongoing and future projects (INR 212.35 crore).
The rights issue will open on June 30th, and close on July 4th. Eligible shareholders, on the record date of June 19th, will receive rights to purchase 6 new equity shares for every 47 fully paid-up equity shares they hold. The new shares will be priced at INR 1,651 per share (including a premium of INR 1,641 per share). The company plans to issue over 1.21 crore (12,107,981) new equity shares.
Sobha Ltd. aims to use the funds raised to support its ambitious growth plans. The company intends to increase its equity capital to INR 10,000 crore over the next five years. Part of the proceeds (INR 905 crore) will also be used to repay or prepay existing borrowings. This will help improve the company's financial health and reduce its debt burden.
Sobha Ltd. is looking to expand its reach beyond South India and Delhi-NCR. The company has plans to enter the Mumbai luxury housing market, aiming to significantly increase annual sales bookings in the coming years. They are exploring various options to acquire land in Mumbai, including outright purchases, partnerships with landowners, and redevelopment projects valued at INR 658.58 crore.
Sobha Ltd.'s long-term vision involves a four-fold increase in annual sales bookings to INR 30,000 crore within the next four to five years. The company's focus on increasing equity capital and reducing debt will provide a strong foundation for this ambitious growth strategy. Sobha Ltd. got listed on the Indian stock exchanges in 2006 and is a leading player in South India. They are looking to replicate their success in other parts of the country. The company's current equity capital base is INR 2,500 crore, and after the rights issue, it will increase to INR 4,500 crore. Promoters with a 52% stake will also participate in the rights issue.
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