Mumbai-based well-known real estate developer, Suraj Estate Developers Ltd has recently announced the re-filing of its DRHP with SEBI in advance of its IPO launch. The company previously filed its DRHP in March 2022. The primary motive of this fundraising is to repay its debt, its subsidiaries’ debt, acquisition of land, land development rights and other corporate purposes.
The real estate developer has a presence in both commercial and residential segments in Mumbai and serves the “luxury” and “value luxury” sectors of the market. If you are looking forward to investing in its upcoming IPO, consider learning about the company and its financials beforehand.
Also Read: How To Apply For An IPO?
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About Suraj Estate Developers Ltd.
Suraj Estate Developers ltd have been in the real estate business for more than 36 years. It has developed commercial and residential properties all over South-Central Mumbai. It is one of the top 10 real estate developers in Mumbai as per an Anarock report, from a supply perspective.
The company received the Award for Best Developer of the Year 2020- Residential at CNN-News18 Real Estate & Business Excellence Awards in Mumbai. It has an impressive portfolio of working with renowned clients such as ICICI Bank, Saraswat Bank, Canara Bank, NSE, Jaypee Group, Axis Bank, Union Bank of India, etc.
The real estate developer has bagged a profit worth about Rs. 32 crore in the Financial Year of 2023 and revenue hiked about 12%. This is due to the launch of new projects in the value-luxury segment.
Suraj Estate Developers Company Financials
Before you decide on investing in this upcoming IPO, take a look at its financial details. Refer to the following table:
| Parameters as Per the Year Ending On (in Rs. Millions Except EPS) | 31 March 2023 | 31 March 2022 | 31 March 2021 |
| Total Assets | 9,425.80 | 8,639.98 | 7,920.01 |
| Total Liabilities | 8,711.48 | 8,246.17 | 7,896.36 |
| Total Expenses | 2,646.78 | 2,377.56 | 2,349.52 |
| Total Revenue | 3078.90 | 2,739.07 | 2,439.98 |
| Profit After Tax | 320.64 | 265.04 | 62.77 |
| EBITDA | 1,510.03 | 1,317.33 | 866.29 |
| Earnings Per Share (Basic and Diluted) | 10.10 | 8.35 | 1.98 |
Strengths
Here are some unique strengths and values of Suraj Estate Developers worth checking out:
- The company has a long-standing presence of about 35 years in the luxury and value luxury segments in South Central Mumbai’s residential market.
- It is the market leader among the top 10 developers with a market share of 15.92% in South-Central Mumbai.
- This company has a highly diversified portfolio of residential estates across various price ranges in the luxury and value luxury segments. Hence, this developer caters to customers from various income brackets.
- It has the reputation of providing quality housing to the tenants/ occupants for free. The company also has a dedicated team to look after the concerns and requirements of the tenants.
- This developer’s experienced and skilled marketing and sales team helps it to position its projects precisely as per price points and locations by tracing market trends.
- Suraj Estate Developers aims to strengthen its portfolio through an asset-light model, entering into development agreements with housing companies and landlords to increase capital efficiency and reduce land acquisition costs. These partnerships are driven by the ability to secure funding, technical expertise and project management skills.
Risks Involved
Along with many upsides of this leading real estate developer, there are some risks as well:
- Being in the real estate industry, the company is always at credit risk. Credit risk is when the company’s customer or counterparty to financial instruments fails to meet its financial obligations. To avoid such a scenario, the company periodically assesses the customer’s financial condition, reliability, etc.
- Another common scenario is liquidity risk. It arises when the company is unable to meet any financial obligation that needs to be settled with cash or its equivalents.
Also Read: Risk of investing in IPO
Summary
Real estate leader Suraj Estate Developers aims to raise Rs. 400 crore through its Initial Public Offering and has already filed preliminary papers with SEBI. The IPO will offer only fresh issues of equity shares and there will be no Offer for Sale.
An amount of Rs. 285 crores will be allocated to settle the debt incurred by the company and its associates, Accord Estates and Iconic Property Developers. Another amount of up to Rs. 35 crore will be earmarked for land acquisition, while the rest of the funds will be kept for various general corporate needs.
Frequently Asked Questions
Suraj Estate Developers Ltd. IPO will issue fresh shares worth Rs. 400 crore with a face value of each share being Rs. 5.
50% of the issues will be available for institutional buyers. The remaining 15% and 35% will be available for non-institutional and retail investors, respectively.
Yes, the company’s profit margin has increased from 9.72% in FY 2022 to 10.49% in FY 2023.
Anand Rathi Advisors Limited and ITI Capital Limited are the book-running lead managers of this IPO.
