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Prestige Estates Projects Ltd. has launched a program to sell shares to eligible institutional investors through a Qualified Institutional Placement (QIP) through which it plans to raise up to Rs 5,000 crore.
Prestige Estates has fixed the floor price of the QIP at Rs 1,755.09 per share, which is almost at par with the stock's closing price. Sources have told that the indicative issue price is at Rs 1,674 per share, which is a 5% discount to the floor price of the QIP.
The share sale is likely to result in an equity dilution of 7.45% of the pre-issue share capital. Prestige Estates plans to utilise the proceeds from the share sale for multiple purposes. Repayment or pre-payment in full or in part of some of the company's borrowings ranks as the top priority for using these proceeds.
Prestige Estates plans to utilise the proceeds from the share sale for multiple purposes. Repayment or pre-payment in full or in part of some of the company's borrowings ranks as the top priority for using these proceeds.
The company also intends to use the funds for the acquisition of land or land development rights, investment in subsidiaries and JVs for funding some of the ongoing projects and one upcoming project which will be undertaken by these units. These funds will also be used for general corporate purposes.
The board of Prestige Estates had approved the plan to raise funds to the tune of Rs 5,000 crore in June this year. The funds were to be raised either through a QIP or through other permissible methods. Shares of Prestige Estates saw a sharp spike towards the end of the trading session to close 2.2% higher near the day's high at Rs 1,753. The stock is up 47% so far in 2024.
