DLF''s $2.4 billion IPO almost covered in days
01 Jun 2007
Mumbai:
The $2.4 billion initial public offer (IPO) by India''s
biggest developer DLF Ltd., is fully subscribed just days
into a two-week global roadshow, a source close to the
issue said.
Sources cited several large bids of between $200 million
and $500 million by institutional investors, with "surprisingly"
strong interest from Indian institutional investors.
Fund managers who met company executives in Singapore
and Hong Kong this week were also enthusiastic, he said.
DLF, which built much of the outsourcing centre of Gurgaon,
near New Delhi, has relaunched its initial public offer
after a stock market meltdown in May last year and some
disputes with minor shareholders stalled the issue.
The IPO comes at a time when many fund managers and analysts
expect a property price correction in India, after a surge
in building activity doubled land prices in major cities
in the last two years.
DLF vice chairman Rajiv Singh said last week that there
was no property price bubble and that his firm''s earnings
in the next year would be a pleasant surprise. DLF is
selling 175 million new shares, equal to 10.27 per cent
of the enlarged company, at Rs500-550 each.
Some
$864 million of the IPO''s proceeds has been earmarked
for land purchases. The offer price values DLF at over
$23 billion at the upper end of the band and places it
above the country''s top private bank ICICI Bank which
is valued at $20.6 billion, Wipro Ltd. which is valued
at $19.5 billion and top lender State Bank of India which
is worth $17.1 billion.
DLF''s
road show, which runs till June 12, will also take in
the United States and Europe. Kotak Mahindra and DSP Merrill
Lynch are the lead arrangers for the issue, along with
Citigroup Deutsche Bank, ICICI Securities, Lehman Brothers,
UBS and SBI Capital Markets.