The Shapoorji Pallonji Group, in order to consolidate its expansive real estate holdings, has formed a new holding company, Shapoorji Pallonji Real Estate (SPRE). The company reportedly plans to monetise the assets by taking it public soon.
According to a report in the Economic Times, this would not only unlock value but also streamline operations and pave the way for monetisation of a portfolio that comprises land parcels spread over 2,000 acres. The value of the land is estimated to be around $6 billion or Rs 50,000 crore.
Venkatesh Gopalakrishnan, who heads the new entity as its managing director and chief executive, told the daily that this plan is in line with the company’s aim to streamline operations and enhance value creation. They aim to position SPRE to leverage its scale and bring their diverse real estate portfolio together.
There are 45 land parcels and projects under this holding company, with a development potential of 140 million sq ft. Projects of 22 million sq ft are currently under development.
According to Gopalakrishnan, the portfolio has a total revenue potential of up to Rs 2 lakh crore after development. The group is considering taking the new company public in 2 years.
In the first phase, the company aims to raise around $800-900 million through an initial public offering of an about 10-12 per cent stake. Further dilutions could follow, the report added, taking the total fundraising to around $2 billion.
The real estate company caters to affordable as well as luxury housing, and has around Rs 6,500 crore of debt.
