Sobha IPO to raise Rs 488-570cr

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The Bangalore-based Sobha Developers, SDL, amongst the country's biggest landholders, is looking to raise between Rs 488 crore (Rs 4.88 billion) and Rs 570 crore (Rs 5.7 billion) as it gears up for a mega IPO, reports The Economic Times.

SDL proposes to issue 88.9 lakh equity shares of Rs 10 each at a price band of Rs 550-640 per share through the 100% book-building process.

The issue will comprise 12.2% of the company's fully diluted equity base. The IPO is scheduled to open between November 23 and 29, 2006.

The IPO proceeds will be used to finance land acquisitions, construction and development of existing and proposed residential projects and for retiring certain loans.

SDL has land reserves of about 2,747 acres in Bangalore, Mysore, Pune, Chennai, Cochin, Thrissur and Coimbatore. Having established its core competency in the IT arena through projects for Infosys, Sobha is also exploring the opportunity of setting up an IT SEZ in Chennai.

Last month, Sobha completed a pre-IPO placement of 4.8 lakh shares with Kotak Mahindra Private Equity Trustee and 97,245 shares with Bennett, Coleman & Company Ltd.

Kotak Mahindra Capital and Enam Financial Consultants are the book running lead managers to the IPO and ICICI Securities is the co-book running lead manager.

PNC Menon-promoted Sobha's total revenues and PAT were Rs 628.43 crore (Rs 6.28 billion) and Rs 89.23 crore (Rs 892.3 million), respectively in FY06. For the first six months of the current fiscal, the company had consolidated revenues of Rs 532.84 crore (Rs 5.32 billion) and Rs 53.97 crore (Rs 539.7 million) of net profit.