At around 13:00 hours, the issue saw strong demand from non-institutional investors and retail investors, who subscribed to the issue over 100 and 42 times respectively, followed by qualified institutional buyers (QIBs) who had subscribed to the issue by 90%.
Prior to the opening of the issue, the GMP for Arkade Developers stood at Rs 85, suggesting a 66% premium over the issue price in the upper price band.
The issue is a greenfield share sale for Rs 410 crore. In the public offer, approximately 50% is reserved for qualified institutional buyers, 35% for retail investors and the remaining 15% for non-institutional investors.
Arkade Developers IPO Price Band
The price band has been fixed at Rs 121-128 per equity share, where investors can bid for 110 shares in one lot.
Analysis of Arkade Developers IPO
Analysts advised investors to subscribe to the IPO as the company is strategically positioned to tap the growing demand for real estate in the Mumbai metropolitan region, driven by rapid urbanisation. “Financial growth is expected to be driven by its upcoming projects, a strategic focus on developments in the eastern suburbs of Mumbai and its combined business model. On a post-issue basis, the company is trading at 14.46x EV/EBITDA (FY24). We have a subscribe rating for the issue,” Arihant Capital said.
Other details
The Company intends to use the net proceeds for the development of its current and future projects, as well as to finance the acquisition of future real estate projects and general corporate purposes.
Arkade Developers is a leading real estate development company with a significant presence in Mumbai. Its operations focus on developing luxury, aspirational lifestyle homes in the region.
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As of June 2024, the Company has developed 2.2 million square feet of residential property (including through partnership entities in which it owns a majority interest).
The business model prioritizes the development of sustainable high-end and premium budget residential projects, with an emphasis on aesthetic design and lifestyle amenities.
While the company’s initial projects were stand-alone residential buildings, its current portfolio of ongoing projects includes gated communities such as Arkade Nest, Arkade Crown and Arkade Aspire, Arkade Prime and Arkade Aura.
Arkade Developers’ revenue in FY24 rose 189% year-on-year to Rs 635 crore, while net profit also doubled to Rs 123 crore in the same period.
Unistone Capital is the sole lead manager of the issue (BRLM). The company’s shares will be listed on the Boston Stock Exchange and the New York Stock Exchange.
(Disclaimer:The recommendations, suggestions, views and opinions of the experts are their own and do not represent the views of the Economic Times)
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