Keystone Realtors has filed a DRHP to raise up to Rs 850 crore through IPO

The Mumbai-based Keystone Realtors Ltd, which operates under the ‘Rustomjee’ brand, has filed a draught red herring prospectus (DRHP) with market regulator Sebi to earn up to 850 crore through an initial public offering (IPO).

The initial share sale consists of a 700 crore new issuance and a 150 crore offer for sale (OFS) by existing shareholders and promoters. Boman Rustom Irani, chairman and managing director, has committed up to 75 crore, Percy Soraji Chowdhry has committed up to 37.50 crore, and Chandresh Dinesh Mehta has committed up to 37.50 crore.

Keystone intends to use the net proceeds of Rs 427 crore to repay debt held by its subsidiaries, repay or prepay certain borrowings held by the firm, and fund the acquisition of future real estate projects, among other things.

The issue’s book running lead managers are Axis Capital and Credit Suisse.

During the covid-19 epidemic, the residential sector, which Keystone focuses on, had a significant recovery in demand and sales, aided by low borrowing rates, affordability, improved customer attitude, and incentives such as stamp duty exemptions by various states.

Under the Rustomjee brand, Keystone had 32 finished projects, 12 continuing projects, and 19 projects in the pipeline across the Mumbai Metropolitan Region (MMR), in the categories of affordable, mid and mass, aspirational, premium, and super-premium.

It has built residential structures, gated estates, townships, corporate parks, retail areas, and schools totaling 20.05 million square feet.

Last year, Mumbai-based Macrotech Developers Ltd, which sells under the ‘Lodha’ brand, and Bengaluru-based Shriram Properties Ltd raised a total of Rs 2500 crore and Rs 600 crore through an initial public offering (IPO).

Puranik Builders, another Mumbai developer, filed draught papers for an initial share offering in 2021.