‘Star-studded’ Sri Lotus Developers to hit the IPO Street

Anand Pandit (image: Wikipedia)

Anand Pandit's office in Mumbai's tony Juhu suburb resembles more of a film producer’s than the salt-and-grime office of a mid-sized real estate developer.

That is because he is one.

His office is adorned with larger-than-life-size pictures of stars like Amitabh Bachchan and Ajay Devgn, among others, besides posters of films in Hindi, Gujarati, and Marathi.

The company is now headed for a Rs 792-crore initial public offering (IPO), after the draft papers were approved by the Securities and Exchange Board of India (Sebi).

Anand has produced a range of films starring Bachchan, Devgn, and Emraan Hashmi. He was also one of the producers of the Randeep Hooda-starrer Swatantrya Veer Savarkar, which performed well in the box office amid controversies.

Star stakes

Even in the lead-up to the IPO, in a fundraising round through a private placement in December, many stars joined.

The Rs 400-crore raise saw the participation of Bachchan as well as Shah Rukh Khan's family trust, both of whom purchased stakes worth around Rs 10 crore, respectively. Hrithik Roshan has a stake worth Rs 1 crore. Other film industry participants included Devgn, Ektaa Kapoor, Rajkumar Rao, and Tiger Shroff.

The private placement also attracted many high many net-worth individuals, as well as ace investors like Ashish Kacholia, who picked up a Rs 50 crore stake. Sri Lotus plans to deploy most of the IPO proceeds in ongoing projects and business development. Anand explains that, as the company expands its play in redevelopment, listing provides a modicum of recognition in the market.

Films, however, have always been secondary to Anand's career, as he said in a recent interaction with Moneycontrol. His aim is to make a name in real estate.

The inspiration, of course, came from films, and from a role played by Bachchan, whom he now counts as a neighbour, customer, and even an investor in his company, Sri Lotus Developers and Realty.

The Trishul inspiration

"I watched Amitabh Bachchan's film Trishul when I was a youngster. In the film, he played the lead character who owned a construction company named Shanti Constructions. And that is what I wanted to become as an adult, a developer. The film production business happened over the years, but my main interest and passion is in real estate," Anand, chairman and managing director of Sri Lotus Developers, said during the interaction, reminiscing the Yash Chopra-directed and Salim-Javed written film.

"I have sold offices and homes purely through personal relationships and word-of-mouth. We have a website now because of the new rules, and for providing information to investors. Even now, for my ongoing projects, we have not prepared sales brochures, but we show potential buyers detailed plans of the projects, which I go through and approve myself. The listing is more for recognition, and not just for funding projects," Anand, an engineer by education, said.

Under the Lotus Developers brand, the company has completed three projects – residential developments Ayana and Ananya, and office project Lotus Signature. It is in the process of building six more, and has seven projects in the pipeline, including both residential and commercial projects, all in Mumbai.

The company's promoters also developed multiple projects before the establishment of the Lotus Developers brand, including developments in Santacruz and Andheri.

Financials

The company’s revenues nearly tripled in FY24 over the previous fiscal to over Rs 467 crore, while the bottom line grew significantly to Rs 119.81 crore over the same period. The company's FY25 financial numbers are awaited.

Anand said that, in existing and ongoing projects, the company has tended to be in the premium segment, and largely in the Bandra-Andheri belt, where many of the big names in the film industry live and work.

His company has sold offices to the likes of Devgn, Sara Ali Khan, Kartik Aaryan, and others. The stars often rent out the premises, mostly to film or television production houses.

And for residential homes, despite operating in the luxury segment, Anand plans to stay in the Rs 9 crore-10 crore range in terms of average pricing, for its ongoing residential projects. Around Rs 550 crore of the upcoming IPO proceeds are expected to be deployed for completing these projects.

As for the company's association with high-profile buyers in the film industry, he says that the company is not dependent on sales to film personalities, but the relationships have worked out in their favour.

"The industry is cash-rich. And the psyche among the industry is that they don't trust people, or they don't want to trust, and they only have a select group that they do. We are among them. They know that Lotus is a brand jo ghar ka hai (of one's home). So it becomes an easy relationship to do business," Anand says.