Kalpataru Eyes Rs 1,590 Crore IPO To Tackle Debt And Loss

Real estate firm Kalpataru Ltd. reported a consolidated net loss of Rs 100.74 crore for the last financial year, driven by lower income. The company recently submitted a Draft Red Herring Prospectus to SEBI to launch an IPO, aiming to raise up to Rs 1,590 crore, primarily to reduce debt. 

The IPO, if approved, will include a fresh issue of shares with a face value of Rs 10 each, and Rs 1,192.5 crore of the proceeds will be allocated for the repayment or prepayment of specific borrowings. 

According to the DRHP, Kalpataru Ltd's net loss narrowed from Rs 200.73 crore in the previous fiscal year to Rs 100.74 crore in FY24. The company’s total income also fell to Rs 2,029.93 crore, down from Rs 3,716.61 crore in FY23.

Kalpataru Ltd is an integrated real estate development firm involved in all stages of real estate development, from land acquisition to project execution and sales. The company currently has 40 ongoing, forthcoming, and planned projects covering a total of 49.77 million square feet, with 25 projects and 22 million square feet under development.

Most of these projects are located in the Mumbai Metropolitan Region and Pune, with additional projects in Hyderabad, Telangana, and Noida, Uttar Pradesh. The company also holds land banks in Surat, Gujarat; Nagpur, Maharashtra; and Udaipur, Rajasthan.

The DRHP notes that the company has posted losses in FY24, FY23, and FY22 due to the way revenue is recognised under its accounting policies, the company said. Revenue for certain projects is recognised only when the customer takes control of the assets, typically linked to the occupancy certificate, it added. 

Meanwhile, expenses related to sales, marketing, and administration are recorded in the profit and loss account in the year they are incurred. It also said that the rising costs of sales and other operational expenses have contributed to expenses outpacing income.

Kalpataru Ltd is part of the Kalpataru Group, which was founded in 1969 by Mofatraj P Munot and has a 55-year legacy. The group has a multinational presence with operations in power transmission, oil and gas, railways, civil infrastructure, logistics, and facility management. Kalpataru Projects International Ltd, another company in the group, is listed on the NSE and BSE.

(With text inputs from PTI)