Oberoi Realty to Raise Rs 6,000 Crore: A Strategic Move for Expansion

Oberoi Realty’s Ambitious Fundraising Plan: Rs 6,000 Crore on the Horizon

Oberoi Realty Limited, one of India’s leading real estate companies, has approved a strategic decision to raise up to Rs 6,000 crore. This capital will be generated through a mix of equity shares, eligible securities, and convertible instruments. The plan, which was finalized at the board meeting on October 10, 2024, reflects the company’s long-term vision to bolster its growth and expansion.

Details of the Securities Issuance

Oberoi Realty aims to raise funds through various securities, including:

• Equity shares, eligible securities, fully or partly convertible debentures, preference shares, and non-convertible debentures.
• Composite issues of debentures and warrants that entitle the holder to apply for equity shares.

These securities may be issued with or without premium and can be subscribed in Indian or foreign currencies. The flexibility of this issuance allows the company to approach a diverse pool of investors and execute this capital raise in one or more tranches, based on market conditions and financial needs.

Type of Issuance: Private Placements and QIPs

The company is exploring multiple modes for raising funds. This includes private placements and qualified institutional placements (QIPs) in accordance with Chapter VI of the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2018. Other permissible modes, such as further public offerings, rights issues, and depository receipts (ADR/GDR), may also be considered. The company will ensure compliance with all regulatory approvals as necessary.

Strong Financials and Strategic Development Projects

Oberoi Realty has a solid financial foundation, with total assets of Rs 19,93,268 lakh in Q1FY25, showing a steady increase from Rs 18,65,086 lakh in Q1FY24. Additionally, the company’s non-current liabilities have decreased from Rs 3,17,498 lakh in Q1FY24 to Rs 2,33,400 lakh in Q1FY25, highlighting better debt management. The company also reported a profit margin of 40.54% in Q1FY25, up from 34.45% in Q1FY24​.

Key Development Projects: Continued Growth in Residential and Commercial Spaces

Oberoi Realty continues to drive revenue from both residential and commercial projects. The company’s flagship projects, such as Elysian and Sky City, have demonstrated strong booking values, with Elysian securing Rs 19,780 lakh and Sky City Rs 18,772 lakh in Q1FY25 alone. Furthermore, the company’s investment properties, such as Commerz II, recorded an occupancy rate of 93% in Q1FY25, maintaining its status as a high-performing commercial asset​.

What Does This Mean for Oberoi Realty’s Future?

With Rs 6,000 crore at its disposal, Oberoi Realty is well-positioned to take on new projects, strengthen its market presence, and scale up operations across various verticals. This capital raise will help the company fuel its ambitious plans while ensuring financial flexibility in the competitive real estate sector.

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.