Published on Monday, June 23, 2025 by Chittorgarh.com Team | Modified on Monday, December 1, 2025
Kalpataru Ltd., , one of the prominent real estate developers in the Mumbai Metropolitan Region of Maharashtra (MMR) and present across all its micro-markets in MMR, will be valued at approximately US 1 billion dollar company post listing.
Kalpataru Ltd. is a 'turn-around' story - balance sheet has been rejuvenated with promoter fund infusion and IPO will further strengthen it. With the infusion of promoter funds of Rs 1,440 crs and IPO proceeds, the capital of the company gets enhanced substantially.
Kalpataru Limited will open its initial public offering on Tuesday, June 24, 2025 and will close on Thursday, June 26, 2025. The Price Band of the Issue has been fixed from ₹ 387 per Equity Share to ₹ 414 per Equity Share. Bids can be made for a minimum of 36 Equity Shares and multiples of 36 Equity Shares thereafter. The Issue consists of a fresh issue of up to such number of Equity Shares aggregating up to ₹ 1,590 crores (the “Fresh Issue”).
The Company proposes to utilize the net proceeds from the Issue towards repayment/pre-payment, in full or part, of certain borrowings availed by the Company and the subsidiaries; and general corporate purposes. The entire IPO proceeds are via fresh issuance — no Offer for Sale (OFS) and no IPO proceeds will be given to the Promoters. A substantial portion (₹1,192.5 crore) is earmarked for debt repayment which will result into bringing down the Net Debt to Equity Ratio.
Kalpataru has exhibited strong operational performance, with Pre-Sales and Collections registering a CAGR of 23% and 31%, respectively, between FY22 and FY24. Notably, Collections for the 9-month period of FY25 stood at approximately ₹2,621 crore — nearly matching the full-year FY24 Collections of ₹2,685 crore — indicating sustained growth momentum and improved execution efficiency.
Company has launched a number of projects totalling ~10 mn sq ft saleable area since FY 2022 till 9M FY25. The projects launched post 1st April 2022 aggregating ~10 mn sq ft out of aggregate of 25 mn sq ft of Ongoing Projects are following PCM Method.
As per Indian Accounting Standards, revenue for these projects following Project Completion Method gets recognized at the time of completion of project, however below the line expenses like sales & marketing, overheads etc gets recognized in the year in which it occurs. That has contributed to the accounting losses in books of accounts.
The company is expected to complete ~11 projects totalling ~10 mn sq ft by FY 2027, as per analysts. Average Realization has improved by 38% i.e. from Rs 9,600 in FY22 to Rs 13,300 by YTD Dec’24 already. The company has already reported Profits in the 9M FY25.
Further, the EBITDA Margins have also grown to ~32% as per YTD Dec’24 financials from the levels of ~23% in FY 2024.
Out of the ~25 mn Sq Ft of Ongoing Projects in Dec’24, 70% of the inventory is already sold for residential projects. Out of this ~25 mn sq ft, ~ 10 mn sq ft area is getting delivered by FY 2027 and we have a track record of selling ~90% of the inventory by the time of receiving OC. That will help in generating substantial Cash Flows.
Real Estate (RE) business is a capital intensive business more so in MMR where the prices of properties are higher. In the initial stages of project, debt is important source of capital. Sizeable part of the Company’s debt corresponds to clear visible cash flows from the underlying projects completing in near term. As ~10 mn sq ft is getting delivered by FY 2027, debt corresponds to these projects will also get repaid alongside the project completion as 90% of the stocks for the project gets sold by the time we receive OC. Repayment schedule of the entire debt is therefore aligned to future cash flows.
Of the total debt of approx. Rs. 11,056 crore mentioned in RHP as of Dec’24, around Rs. 922 crore was part of Rs 1,440 crs infused by promoters in the form of CCD and was interest free. That has already been converted into equity in Mar’25. So that will not be part of debt going forward. Also there was Cash & Bank Balance of ~Rs 935 crs as on Dec’24. Hence, Net Debt level will be substantially lower ~Rs 9,100 crore.
From the issue proceeds, Rs. 1,192.5 crore is going to be used for repayment of debt. This will bring the Net Debt/Equity below 2 post IPO, as per analysts.
Cost of Debt is expected to come down, as the impact of rate reduction by government of ~100 bps as well as being into the listed domain. Also improved rating and proposed refinancing will further bring down the average cost of debt.
The promoter infused capital at Rs 517.25 per share in March 2025, however the IPO offer price per share is Rs 414 which is ~20% discount to the promoter conversion rate.
Going forward, focus will be on Capital Light Model by way of JV/ JDA and Society Redevelopment, as per analysts.
Summarising, Kalpataru is amongst the Top 5 Developers in India’s largest real estate market Mumbai with a focus on MMR & Pune. Kalpataru is a well-established brand name with a proven track record thereby commanding a premium pricing. It has proven end-to-end execution capabilities with an ability to deliver projects in a timely manner. It has a strong pipeline of projects with visibility towards near term cash flows and a focus on Residential Projects. It is a leading real estate company in implementation of Green & Sustainable Buildings. It has experienced and qualified management team with strong human resource practices.
Kalpataru’s IPO is an opportunity for investors (including retail) to invest in Mumbai MMR real estate market.
