Indian IPO

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Monday, May 01, 2006

Public issue on schedule, says DLF

Real estate major DLF group, said that its mega IPO is on scheduled with the Rs 13,000 crore (Rs 130 billion) issue to hit the market some time in June-end or the first half of July, as per original plans. “Short-term fluctuations will not impact our IPO,” Ramesh Sanka, CFO, DLF group said, reports The Economic Times.

On being queried about the group’s plan of action, if it were not able to raise the entire Rs 13,000 crore from the primary issue, Sanka said the group would then approach banks for raising debt to meet the shortfall. As per objects of the issue, the group plans to pre-pay loans to the company to the tune of Rs 4,000 crore (Rs 40 billion), while earmarking Rs 6,500 crore (Rs 65 billion) for land acquisitions and Rs 3,100 crore (Rs 31 billion) for development and construction costs of existing projects.

Commenting on objections raised by certain minority shareholders and complaints filed to Sebi, he refuted those claims and said that the group has already sent its response to the market-watcher and will go by whatever decision Sebi takes in this matter.

As per consolidated financial performance of the group, it recorded sales turnover of Rs 1,291 crore (Rs 12.91 billion) in FY05-06, with net profit of Rs 199.4 crore (Rs 1.99 billion), based on percentage completion method over the last five years. However, according to Sanka, if one were to calculate the group’s net profit and turnover by percentage completion method, for only one year, the net profit would swell to Rs 410 crore (Rs 4.10 billion) over turnover of Rs 1,960 crore (Rs 19.60 billion).

He said, around Rs 6,000 crore (Rs 60 billion) worth of projects were currently under development. Of these, around Rs 4,000 crore (Rs 40 billion) related to residential and retail space, while the remaining was commercial office space.

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