Realty firm Signature Global, in collaboration with HDFC Capital and IFC, is set to make its debut in the capital market on September 20th, aiming to raise an impressive Rs 730 crore through its Initial Public Offering (IPO). In a noteworthy prelude to this significant event, Signature Global has successfully garnered Rs 318.5 crore from anchor investors, with prominent participation from institutions such as Nomura Trust and Banking Co Ltd, Kotak Mahindra Trustee Co Ltd, among others.
Signature Global recently disclosed in a regulatory filing that during the Anchor Investors (AIs) phase of the public issue, a total of 82,72,700 equity shares were subscribed at a price of Rs 385 per equity share. Nomura Trust and Banking Co Ltd stood out as the leading investor, acquiring a substantial 18,70,094 shares during this phase. Additionally, significant investments came from entities like Kotak India EQ Contra Fund, Quant Mutual Fund, Nippon India Equity Opportunities AIF, Bandhan Core Equity Fund, Morgan Stanley Asia, Societe Generale, BNP Paribas Arbitrage, and Goldman Sachs Singapore.
Signature Global commenced its IPO journey by filing its Draft Red Herring Prospectus (DRHP) with the capital markets regulator, SEBI, in July last year. The IPO is priced at a range of Rs 366-385 per share, as indicated in the Red Herring Prospectus (RHP). The total size of the IPO stands at an impressive Rs 730 crore, consisting of a fresh issue of shares up to Rs 603 crore and an offer for sale (OFS) of up to Rs 127 crore. The primary objective of this IPO is to significantly reduce the company’s debt.
Signature Global’s financial performance in recent years reflects its market strength. The company achieved a remarkable 32 percent growth in sales bookings, reaching Rs 3,430.58 crore in the last fiscal year, driven by robust housing demand. In comparison, the previous fiscal year saw sales bookings of Rs 2,590 crore. Signature Global’s collection from customers also surged to Rs 1,920 crore in the last fiscal year, up from Rs 1,282.14 crore in the preceding year.
Signature Global’s commitment to growth is evident in its expansion efforts. In the 2022-23 financial year, the company launched 6.21 million square feet of residential and commercial space, a significant increase from the 4.21 million square feet launched in the previous year. Moreover, Signature Global delivered 4.01 million square feet of space in the last fiscal year, compared to 3.03 million square feet in the preceding year.
Signature Global’s Chairman, Pradeep Aggarwal, outlined the company’s financial strategy, emphasizing the intention to utilize Rs 432 crore from the IPO proceeds for debt reduction. The remaining funds will support inorganic growth through strategic land acquisitions and general corporate purposes.
Currently, the promoter group holds a majority stake of 78.35 percent in Signature Global. Post-listing, their ownership is expected to reduce to approximately 69-70 percent in the company due to the Offer for Sale (OFS) mechanism. The International Finance Corporation (IFC) will also partially divest its 5.38 percent stake in the company through the OFS.
The financial picture of Signature Global indicates a positive trajectory. The company’s total income for the last fiscal year rose to Rs 1,585.87 crore, compared to Rs 939.60 crore in the previous year. Additionally, the net loss significantly narrowed down to Rs 63.71 crore in the 2022-23 fiscal year, a marked improvement from the Rs 115.5 crore loss in the previous year.
Signature Global initiated its journey in 2014 through its subsidiary, Signature Builders Pvt Ltd, with the launch of the ‘Solera’ project on 6.13 acres of land in Gurugram, Haryana. As of March 31, 2023, Signature Global has successfully sold 27,965 residential and commercial units, all within the Delhi-NCR region, with a collective saleable area of an impressive 18.90 million square feet. During this period, the company sold 25,089 residential units with an average selling price of Rs 36 lakh per unit.
In conclusion, Signature Global’s entry into the capital market is poised to make a significant impact. The company’s strategic anchor investments and robust financial performance indicate a promising future as it aims to unlock growth potential, reduce debt, and continue its trajectory of success.