In the 1970s, three friends ventured into a chit funds business. Overtime, this small business evolved into a financial conglomerate called Shriram Group. The group’s real estate arm, Shriram Properties, is now set to hit the exchanges with a ₹600 crore IPO. The company primarily focuses on mid-market and affordable segments in the cities like Bengaluru and Chennai. The company’s financial performance has been impacted due to the pandemic and it has suffered losses over the last two years.
All about the IPO
In the early 2000s, the Indian economy was on a sharp upward trajectory and the prices of real estate were rising. Riding on this wave, Shriram Properties forayed into this space. It has also received financial backing from PE investors TPG, Tata Capital, Walton Street Capital and Starwood.
The company has evolved into one of the top five real estate companies in South India. It currently has 35 projects in the pipeline.
Revenue: -18.5%; Net loss: NA (FY19-21 CAGR)
The performance was hampered by the pandemic-led cancellations, resulting in lower volumes and gross collections.
Good to know
The share of top 20 players has significantly improved post the implementation of RERA in Shriram Properties key markets like Bengaluru and Chennai. Also, the lower interest rates and pent-up demand for urban housing is expected to benefit organised players like Shriram Properties. The third quarter of 2021 witnessed new launches of 32,863 residential units, up 21% quarter-on-quarter.