Sri Lotus Developers mobilises Rs 237 crore via anchor book ahead of IPO

Mumbai, July 29, 2025 — Sri Lotus Developers, a leading South India-based real estate company, has successfully raised ₹237 crore through its anchor book, ahead of its much-anticipated initial public offering (IPO). The pre-IPO placement witnessed participation from a diversified set of institutional investors, indicating solid market appetite for the company’s public debut.

The IPO is scheduled to open for public subscription on July 30 and close on August 1, with the price band fixed at ₹290–₹310 per equity share. The total issue size is expected to be around ₹600 crore.

Anchor Book Receives Strong Response

According to regulatory filings made to the stock exchanges, the company allocated 76.45 lakh equity shares to 26 anchor investors at ₹310 per share — the upper end of the price band — raising ₹237 crore.

Notable institutional participants in the anchor round included marquee names such as SBI Mutual Fund, ICICI Prudential, HDFC Life Insurance, Kotak Mahindra AMC, and Aditya Birla Sun Life. Foreign portfolio investors (FPIs) like Nomura and Goldman Sachs also took part in the allocation.

“This strong anchor book reflects investor confidence in the business fundamentals of Sri Lotus Developers, its robust project pipeline, and its experienced management team,” said Arun Singh, Managing Director at Capital Axis Advisors.

Company Profile and Growth Story

Founded in 2008, Sri Lotus Developers has established itself as a premium residential and commercial real estate developer, primarily operating in Bengaluru, Chennai, and Hyderabad. The company has delivered over 7 million sq. ft. of projects and currently has more than 12 million sq. ft. under various stages of development.

The developer is known for its focus on sustainable construction practices, timely delivery, and quality execution — factors that have helped it carve a niche in an otherwise fragmented market.

According to the company’s red herring prospectus (RHP), the net proceeds from the IPO will be used for debt reduction, acquisition of land parcels, and general corporate purposes.

Financial Snapshot

Sri Lotus Developers posted a total revenue of ₹1,114 crore in FY24, registering a growth of 22% compared to ₹912 crore in FY23. Its net profit stood at ₹136 crore for FY24, up from ₹98 crore the previous year.

“The company has maintained a healthy EBITDA margin of over 27% and has been steadily reducing its debt-to-equity ratio, which stood at 0.65x in FY24,” noted Priya Rawat, Research Analyst at Monarch Capital.

Sector Context and Competitive Position

The real estate sector in India has witnessed a revival post-COVID, with increasing urban migration, higher disposable incomes, and low home loan interest rates spurring demand. Mid-income and premium residential projects, especially in metro cities like Bengaluru and Chennai, have seen consistent uptake.

“Sri Lotus Developers’ positioning in South India gives it a strategic edge in catering to high-demand micro-markets,” said Raghuram Nair, a real estate sector analyst at Kotak Securities. “Their integrated development approach and strong brand recall make them a formidable player among listed peers like Sobha, Prestige Estates, and Brigade Enterprises.”

IPO Structure and Offer Details

The IPO comprises a fresh issue of ₹450 crore and an offer-for-sale (OFS) of ₹150 crore by the company’s promoters and early investors. Post-IPO, the promoter holding will come down to around 68% from the current 85%.

The lot size for retail investors is 48 shares, translating to a minimum investment of ₹14,880 at the lower band. 50% of the offer is reserved for qualified institutional buyers (QIBs), 15% for non-institutional investors (NIIs), and 35% for retail investors.

Investor Outlook: Should You Subscribe?

Brokerages and market analysts have largely given a “Subscribe” rating to the IPO on account of reasonable valuations and strong fundamentals.

At the upper price band, the IPO is valued at a P/E of 18.2x based on FY24 earnings, which is relatively attractive compared to peers trading at an average P/E of 22–25x.

“Given the company’s solid financial track record, strong project pipeline, and consistent delivery history, we recommend subscribing for long-term gains,” stated Axis Securities in its IPO note.

However, some caution is warranted due to sectoral cyclicality and rising input costs that could pressure margins in the medium term.

Sri Lotus Developers’ successful anchor book mobilisation reflects significant institutional trust and sets a positive tone for the IPO. With a strong regional presence, healthy financials, and supportive industry tailwinds, the company’s public debut is poised to attract considerable investor interest.

Retail investors eyeing long-term wealth creation through exposure to the real estate sector may find this IPO a promising opportunity.