The Shapoorji Pallonji Group has formed a new holding entity, Shapoorji Pallonji Real Estate (SPRE), to consolidate its real estate assets across India. As reported by The Economic Times, the group intends to monetize these assets by taking the new firm public in the foreseeable future.
This initiative is aimed at enhancing value, optimizing operations, and facilitating the monetization of a portfolio that spans over 2,000 acres of land, with assets valued at approximately $6 billion.
According to Venkatesh Gopalakrishnan, Managing Director and CEO of SPRE, the creation of a unified holding company is aligned with the group’s strategic vision to streamline operations and enhance value creation. He emphasized that SPRE is well-positioned to improve operational efficiencies and capitalize on growth opportunities through the scale of its diverse real estate portfolio.
SPRE’s portfolio encompasses the entire real estate holdings of the group, which include 45 land parcels and projects with a development potential of 140 million square feet. Presently, projects covering 22 million square feet are under various stages of development.
Gopalakrishnan noted that the portfolio has the potential to generate up to ₹2 lakh crore in revenue post-development. The company is considering a public offering within the next two years as part of its broader strategy.
SPRE’s real estate assets are strategically located in key urban centers such as Mumbai, Pune, Bengaluru, Gurugram, and Kolkata, with additional properties in Mysore and Nagpur. The portfolio features both high-density urban sites and extensive land tracts between Mumbai and Pune. The company is managing approximately ₹6,500 crore in debt, primarily from construction finance and asset-backed loans, with plans to reduce this by prepaying ₹2,500-3,000 crore within the year.
The consolidation is expected to enhance the company’s ability to execute large projects, increase transparency, and maximize returns, thereby strengthening investor confidence.
The group is reportedly planning to raise around $800-900 million through an initial public offering (IPO) by offering a 10-12% stake, with the potential to raise up to $2 billion through further stake dilutions.
This restructuring is part of the Shapoorji Pallonji Group’s broader strategy to streamline its business operations. By separating its various verticals, including construction and real estate, the group aims to establish distinct capital structures and improve operational efficiency.
Additionally, SPRE plans to expand its middle-income housing segment, Joyville Shapoorji, with the goal of launching five new projects annually. Supported by major investors such as the World Bank’s IFC, Actis, and the Asian Development Bank, Joyville is expected to play a key role in SPRE’s growth strategy.
The establishment of SPRE underscores the Shapoorji Pallonji Group’s focus on sustained growth in the real estate sector, leveraging its substantial land bank and strategic financial planning to drive future success.
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By Proptechbuzz
By Ravi Kumar
