— PHOTO: VIVEK BENDRE

SEIZING OPPORTUNITIES: K. P. Singh (left), Chairman, DLF, and Rajiv Singh, Vice-Chairman, at a press conference in Mumbai on Tuesday.

MUMBAI: The much-awaited mega initial public offering by DLF, a real estate developer, has been announced and the company will enter the capital market with a public issue of 17.50 crore equity shares of Rs. 2 each through the 100 per cent book building process. The issue will open on June 11 and close on June 14. The price band has been fixed at Rs. 500-550 per share. The issue will constitute 10.26 per cent of the fully diluted post-issue capital of the company. At the price band, the company hopes to raise between Rs. 8,750 crore and Rs. 9,625 crore.

At least 60 per cent of the net issue will be allotted on a proportionate basis to Qualified Institutional Buyers (QIBs), 10 per cent will be available on a proportionate basis to non-institutional bidders and 30 per cent to retail individual bidders. The shares will be listed on both the National and the Bombay stock exchanges.

Out of the net proceeds of the issue, DLF proposes to use Rs. 3,500 crore for acquisition of land and development rights, Rs. 3,493.40 crore for development and construction costs for existing projects and the remaining amount for prepayment of loans of the company.

Addressing the media here on Tuesday, Rajiv Singh, Vice-Chairman and Managing Director, said, "We are presently in residential, commercial and retail segments and are committed to move into hotels and Special Economic Zone (SEZ) infrastructure. We will be leveraging our real estate capital in SEZ infrastructure and hospitality."

DLF is present in 31 cities and has already developed 224 million sq. ft. and has another 44 million sq. ft. under development and construction. The company has reserves of 10,255 acres with a development potential of 554 million sq. ft. This land bank, according to Mr. Singh, will take around ten years to develop.

The company already has a presence in cinemas through group company DT Cinemas and is foraying into the insurance market through a joint venture with Prudential of the U.S. and its brand Primerica. Mr. Singh said regulatory approval was awaited and the company would be launched later this year.

DLF reported a net profit of Rs. 414.60 crore for the year ending March 2007 against Rs. 96.10 crore in the previous year.

The company attributed the jump in profit to a significant rise in commercial property sales. Also, for the year ending March 2007, the company's outstanding loans amounted to Rs. 9,932.80 crore (Rs. 4,132 crore).

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