Real estate developer Signature Global files draft papers with Sebi for Rs 1,000-crore IPO

Real estate developer Signature Global files draft papers with Sebi for Rs 1,000-crore IPO

Roger Pettingell Sarasota Real Estate

Gurgaon based real estate developer Signature Global has filed draft papers with Sebi to raise Rs 1,000 crore through an initial public offering (IPO).

As per the document, will comprise a fresh issue of equity shares worth up to Rs 750 crore and an Offer for Sale (OFS) of up to Rs 250 crore.

The draft red herring prospectus (DRHP) was filed on Tuesday where it has said that funds will be used to pay the debt of subsidiaries Signatureglobal Homes, Signature Infrabuild, Signatureglobal Developers and Sternal Buildcon.

“We intend to use the net proceeds for repayment or prepayment of certain borrowings. It will also be used for the Infusion of funds in certain of our subsidiaries. The fund will also be used for Inorganic growth through land acquisitions and general corporate purposes,” the company has said in the draft paper.

Signature Global is primarily focused on the development of affordable housing projects in the National Capital Region (NCR).

It has recently raised long term capital of Rs 400 crore from

Capital Affordable Real Estate Fund 3 (H-CARE 3) – a fund managed by HDFC Capital.

In the past five years the absorption level has outnumbered supply in the affordable and mid-segment category, which suggests there is sustainable demand. Of the cumulative units launched from 2019 to 2021, Gurugram’s share was approximately 63%, in monetary terms.

“As of March 31, 2022, 41 out of 59 of our total projects comprising our completed projects, ongoing projects and forthcoming projects, were located in Gurugram and 12 were located in Sohna in Haryana. We have incurred net loss in the past, and we may not be able to achieve or maintain profitability in the future,” the company has said in the filing.

In Fiscal 2020, 2021 and 2022, the company had net cash inflow from operating activities of Rs 725.38 million, Rs 364.38 million and Rs 2,052.44 million, respectively.

“However, due to factors such as our accounting policy on revenue recognition as mentioned above, our Company made net losses after tax in Fiscal 2020, 2021 and 2022,” the company said.

Signature Global has plans to create good quality affordable homes and community spaces over the coming years. The company is focussed on developing affordable housing projects under Haryana’s affordable housing policy (HAHP)and developing independent floors under DDJAY (Deen Dayal Jan Awas yojna) affordable plotting policy.

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