Prestige estates witnesses rise in stocks by raising Rs. 5,000 crore via QIP

Bengaluru based real estate conglomerate Prestige Group has gained their share today after they informed that it has raised Rs. 5,000 crore by selling equity shares to institutional investors through private placement.

According to CLSA, the recent move made by Prestige Estates has effectively addressed concerns from market participants relating to growth potential and debt levels. This development supports a positive shift in stock valuations. 

In July of this year, shareholders approved an initiative that would enable capital raising through public or private channels including Qualified Institutional Placement (QIP) issuance of equity shares for up to Rs. 5,000 crore.

Recently, a fundraising committee under the board of directors at Prestige Estates authorized allocations totaling 2.98 crore equity shares priced at Rs. 1,674 per share exclusively for eligible institutional investors - discounted from floor price rates fixed at Rs.1 Rs.75509/share downwards by around 4%.

Prestige Group is one of the top rated real estate developers of India, having a strong presence in six major cities and urban centers. Currently, the company has a pipeline of 108 ongoing and upcoming project in various segments.

The FY24 business portfolio depicted that, the company has completed 150 residential projects. It has 37 ongoing projects and 30 projects under the planning stage.

The portfolio of the company is quite balanced with sales amounted to Rs.3,030 crore in Q1FY25. Their sales is supported by healthy collections of Rs.2,916 crore. verage realisations increased to Rs. 11,934 per square foot for apartments, villas, and commercial spaces, and Rs.7,285 per square foot for plots.

Prestige Estates' stock closed 4% lower at Rs.1,785 on the National Stock Exchange (NSE) in the previous session. Despite this dip, the stock has surged about 50% year-to-date, significantly outperforming Nifty's 15% return.

Over the past 12 months, the stock has skyrocketed 181%, more than doubling investors' capital, while Nifty saw a 28% rise during the same period.