Brigade Enterprises IPO was subscribed 0.77 times on first day. The issue received bids for 1.27 crore shares as against 1.66 crore shares on offer. The Bangalore based firm has set a price band of Rs 351-390 per share for its 16.62-million-share public issue. The IPO will close on 13 December 2007. Post-issue, promoter holding in the company will reduce to around 58%. The IPO proceeds will be used to fund land acquisition and for development and construction of existing properties.
Bangalore-based real estate developer Brigade Enterprises (BEL) has been developing properties mainly in and around Bangalore, Mysore and Mangalore. So far, it has developed 5.67 million square feet (sq ft) of saleable area through residential, commercial and hospitality projects. BEL holds land reserves of 403.45 acres, which will translate into 44.16 million sq ft of development rights.
It expects to develop 23.14 million sq ft of saleable area in the next 3-5 years. Out of this, integrated lifestyle enclaves account for 47%, residential properties 27%, commercial properties 22%, and hospitality projects account for the remaining share of forthcoming projects. Of these 28 projects, approximately 12.53 million sq ft is already under construction and Bangalore accounts for nearly 75% of these projects.
JP Morgan India, Enam Securities and ICICI Securities are the book running lead managers to the issue. Brigade joins the list of Indian developers rushing to the capital market to cash in on an urban real estate boom. |