NEW DELHI: SRS Group, the north India centric realtor, is planning to float an initial public offering by the end of this fiscal to part-fund its Rs 1,000-crore entertainment investment plans, a top official said.
The developer added that Rs 500 crore would be invested in the expansion of the retail business, Rs 350 crore in multiplex cinemas, and the balance would be invested in the food & beverage business over the next three years.
“According to our initial discussions, we will go for a Rs 500-crore IPO. Another Rs 300 crore will raised as debt and rest will be from internal accruals,” SRS Group director Jyoti Prakash Gadia told DNA
Money.
SRS added that it plans to increase the number of its organised retail outlets to 100 by the end of the current fiscal, with the total area under retail operation expected to be around 15,000 sq ft by 2009. It plans to open 16 Value Bazaars every month and has signed lease agreements for over 50 locations with developers like Omaxe, Chadha Group.
“We are confident that the trend of shopping at organised retail outlets will catch on in tier-2 cities in a big way in the next couple of years,” SRS president Tinku Singh said. However, if the current market conditions prevail and the IPO plan falls through, it might look for a round of private equity investments for its projects.
SRS added that it has already tied up a Rs 300 crore investment, which the developer requires for its next three months’ expansion plans. It currently is taking debt at rates of 12%-13%. “When we go for an IPO, it will take hardly one month for us to come up with it,” Singh said.
“We are targeting a topline of Rs 10,000 crore in a few years from Rs 700 crore now. Our new real estate projects will start adding to our balance sheets from the second year onwards,” said Anil Jindal, chairman, SRS Group.
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