Board of Puravankara Approves up to Rs.1000 Crore Fundraising Through QIP

On Thursday Board of Directors of Puravanakara Limited approved a fundraising plan with Rs. 1000 Cr via Qualified Institutional Placement (QIP) mode in one or more phases. Through this method, listed companies raise capital by issuing fresh equity shares, or any securities other than warrants convertible to equity shares, to Qualified Institutional Buyers (QIB). The news came forth after the company had announced its acquisition of 12.75 acres of land in Patlipada on Ghodbunder Road in Thane. The purchase happened by its wholly owned subsidiary Purva Oak Limited. With the fundraising, the company plans to raise funds by issuing equity shares, debentures, or preference shares, which will be subject to shareholder approval.

About the company:

Headquartered in Bengaluru, the real estate developer was established back in 1975 by Ravi Puravankara. The company has since expanded both domestically in multiple cities in South India and internationally in Dubai and Colombo. The company holds its legacy in building high-quality homes, with state-of-art-luxury and theme-based projects that reflects future homes with innovative technology.

Company’s current financials and stocks:

The Q4FY24 showed that the company faced a dip in net profit by 33% YoY at Rs. 42 Cr. However, it had clocked a revenue of Rs. 947 Cr, up by 112% YoY. The company also emerged as the contract-bearer for the redevelopment of a residential housing society in Mumbai’s Pali Hill Locality. In the past 12 months, the shares of the company have outperformed the NIFTY 50 and the NIFTY REALTY Index both. Puravankara shares delivered an outperformance with 367% returns in the last 12 months. The NIFTY 50 had given 25% returns in that time period and the Realty Index generated 114% returns. Despite a strong rally, the stock exhibits less volatility with its Beta less than 1 for the 1-year time period.

Conclusion:

The company’s bold decision led the company to open at Rs. 449 on Friday, its intra-day high, after closing at a low of Rs. 437 on Thursday.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions