Arkade Developers IPO Launches on Monday: Key Details, GMP, and Allotment Dates

Arkade Developers Ltd. is set to launch its Initial Public Offering (IPO) on Monday, September 16, 2024. The company aims to raise ₹410 crore through this IPO. The price band for the shares has been set between ₹121 and ₹128 per share. Investors will have the option to bid for a minimum of one lot, which consists of 110 shares. The issue is already trading at a 49% premium in the grey market, which translates to a ₹63 premium over the upper limit of the price band.

IPO Subscription Timeline

The subscription period for Arkade Developers' IPO will commence on September 16 and conclude on September 19, 2024. This timing is strategic, given the benchmark indices are approaching record highs, which could attract significant investor interest in the offering.

Pricing and Market Capitalization

The IPO is priced between ₹121 and ₹128 per share. With the upper price band, Arkade Developers' post-listing market capitalization is anticipated to reach ₹2,376 crore. This valuation reflects the company's growth trajectory and market potential.

Offer Structure

The IPO will issue fresh shares worth ₹410 crore, with no offer-for-sale (OFS) component involved. The company has already secured ₹20 crore through a pre-IPO placement. The allocation of the issue is as follows:

• Qualified Institutional Buyers (QIBs): 50% of the offer, amounting to ₹204 crore.

• Non-Institutional Investors: 15% of the offer, or ₹61 crore.

• Retail Investors: 35% of the offer, totaling ₹143 crore.

Utilization of Funds

The proceeds from the IPO will be allocated towards several key areas:

• Development of Existing Projects: Funds will be used to advance ongoing projects.

• Acquisition of Future Projects: The company plans to acquire new real estate projects.

• General Corporate Purposes: Additional funds will be reserved for general corporate uses.

Company Background

Arkade Developers Ltd. is a prominent real estate development firm with a significant presence in Mumbai. As of July 31, 2023, the company had developed 1.80 million square feet of residential property. Since 2017, through the first quarter of FY 2023, Arkade Developers has launched 1,040 residential units and sold 792 units within the Mumbai Metropolitan Region (MMR).

Financial Performance

The company's financial performance for the past few years is as follows:

• FY 2023: Revenue of ₹224 crore.

• FY 2022: Revenue of ₹237 crore.

• FY 2021: Revenue of ₹113 crore.

IPO Management

Unistone Capital is serving as the sole book-running lead manager (BRLM) for the IPO. Bigshare Services Pvt. Ltd. will act as the registrar for the offering. Their roles are crucial in managing the IPO process and ensuring its smooth execution.

Allotment and Listing

The IPO allotment is expected to be finalized on September 20, 2024. Following this, Arkade Developers’ shares will be listed on the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE), with a tentative listing date set for September 24, 2024. This will mark the company's transition to being a publicly traded entity and provide investors with the opportunity to trade its shares on these major stock exchanges.