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IPO ALERT: Suraj Estate Developers IPO opens today

Suraj Estate Developers
MMR had the maximum share among all cities in the range of 24%–37% across years, with an average of 30% in terms of supply from 2016 to H1 2023. This shows that there is an overall growth in the supply and that there is potential for further development. MMR also has the highest absorption rate; since 2016, on average, MMR has been contributing approximately 30% of the total absorption, followed by Bangalore and NCR, which account for approximately 18% of the total absorption levels from 2016 to 2022. From 2016 to H1 2023, the average base selling price in MMR has been approximately INR 10,980 per square foot, which is the highest across the Top Seven Indian Markets. We expect that there will be a gradual increase in absorption until 2026. New launches in 2024 are likely to be almost twice as high as those in 2021 and are expected to gradually increase year-on-year post-2023.

Suraj Estate has been actively involved in the real estate business since 1986, specialising in the development of real estate across the residential and commercial sectors in the South-Central Mumbai region. The residential portfolio is strategically located in the markets of Mahim, Dadar, Prabhadevi, and Parel, which are sub-markets of the South-Central Mumbai micro-market where Suraj Estate has established a significant presence. The focus lies on value, luxury, luxury segments, and the commercial sector. Suraj Estate is now expanding its footprint into residential real estate development in the Bandra sub-market. The primary area of operation remains the South-Central region in Mumbai, encompassing Mahim, Matunga, Dadar, Prabhadevi, and Parel. Suraj Estate’s expertise lies in the redevelopment of tenanted properties under Regulation 33(7) of the Development Control and Promotion Regulations (DCPR) in the Mumbai region. Given that most land parcels in the South-Central Mumbai market are redevelopment projects, the core competence of Suraj Estate lies in tenant settlement, a crucial element for unlocking value on such land parcels. The company identifies leased or non-leased properties with existing tenants and engages with landlords through development agreements or outright purchases via conveyance deeds. Suraj Estate does not provide construction services independently and is 100% dependent on third-party contractors for the construction services of its projects. Since its incorporation, Suraj Estate has completed 42 projects, with a developed area exceeding 1,046,543.20 sq. ft. in the south-central Mumbai region. In addition to completed projects, there are currently 13 ongoing projects with a developable area of 2,034,434.40 sq. ft. and a saleable RERA carpet area of 609,928 sq. ft. Furthermore, there are 16 upcoming projects with an estimated carpet area of 744,149 sq. ft.

Suraj’s total income for FY23 was INR 3,078.90 million as compared to INR 2,739.07 million for FY22, representing an increase of 12.41% YoY. The company’s PAT for FY23 was INR 320.64 million, as compared to Rs 265.04 million for FY22. Its profit margin increased to 10.49% in FY23 from 9.72% in FY22. The company’s ROE and ROCE were 58.01% and 22.44% in FY23.

Objects of the issue:
1. Repayment of borrowings
2. Acquisition of land
3. General corporate purposes


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