Dosti Realty plans IPO to fund expansion

Dosti Realty is active in Mumbai and Pune and is now eyeing prime society redevelopment projects across the Mumbai Metropolitan Region (MMR) and potential ventures in Gujarat.

Mumbai-based Dosti Realty Limited (DRL) is gearing up to float an Initial Public Offering (IPO) within the next 12 to 24 months, alongside a strategic expansion into the warehousing and logistics sector in the Thane and Bhiwandi belt.

Deepak Goradia, Chairman and Managing Director of Dosti Realty, told Moneycontrol in an interview that discussions with bankers are currently underway  and that the capital raised from the IPO will be channeled towards the company's expansion plans and debt repayment strategy.  He said it was difficult to say at this point as to how much they would raise, but were  still evaluating the possibility.

Dosti Realty, known for its active presence in the Mumbai real estate market, expanded into Pune in the first half of 2023. The company is now eyeing prime society redevelopment projects across the Mumbai Metropolitan Region (MMR) and potential ventures in Gujarat.

In October 2023, credit rating agency CARE withdrew the company’s credit rating ( CARE D) citing non-cooperation by issuer. CARE also highlighted instances of delays in debt servicing of loans availed by DRL.

Goradia further said the significant land bank owned by Dosti Realty in MMR has the potential to accommodate construction of up to 25 million sqft. Since its establishment in 1980, the company has successfully developed 12 million sqft, with an additional seven million sqft currently under construction.

The decision to go public follows a trend in the real estate sector, with several companies opting for IPOs to raise capital. In recent years, a number of real estate companies have been turning to the capital markets to raise funds.

In Mumbai, Keystone Realtors, also known as Rustomjee Group, got listed two years ago, Macrotech Developers also known as Lodha group  got listed in the last five years. Apart from this, Arkade Developers are planning to get listed with the exchange in the coming days .

Notably, Hiranandani Group, a prominent Mumbai and Thane based developer is also mulling over an IPO but has ruled out IPO plans for 2024.