“The conglomerate is talking to international investors seeking a reasonable valuation of the residential-cum-commercial property,” one of the persons cited earlier told ET. Some global investors have likely shown interest as negotiations are going on. Imperial Avenue is one such premium property. Shapoorji Pallonji Group aims to raise anything between $225 million and $375 million through its sale, sources said.
The SP group did not comment. The funds raised will be part of working capital and growth requirements, executives close to the group said. “The real estate market globally is on an upswing and the SP group will seek to get benefits from this upswing. However, these are early days yet to comment on specifics,” one of them said. The SP group has had a presence in the Dubai real estate market for the last four to five years.
The Shapoorji group of companies had been tackling a stretched balance sheet in 2020 after the outbreak of Covid-19, but recent asset monetisation efforts and overall economic recovery have helped them get back on track by significantly reducing the debt burden. Sterling and Wilson is said to be in sale talks with bulge-bracket private equity funds, including Canadian funds such as Brookfield and CPPIB, as well as Indian conglomerates such as Adani and Reliance Industries, hoping to reap the benefits of increased interest in renewable energy in the country, ET had reported on September 8.
Shapoorji Pallonji and Company Private Ltd. (SPCPL), the flagship entity of the group, had applied for a one-time restructuring (OTR) plan under Reserve Bank of India’s resolution framework for Covid-19 related stress last year. Subsequently, the OTR plan was successfully implemented on March 31 this year. The moratorium period was over on September 30.
In the first half of this financial year, the promoters infused Rs 4,040 crore in the group companies, which was then used to repay the inter-corporate deposits (ICDs) extended by SPCPL to these entities, according ICRA Ratings. Subsequently, SPCPL has repaid Rs 4,040 crore of OTR debt. About a month ago, ICRA removed SPCPL from watch with negative implications and placed it on watch with developing implications. It is now rated as BBB+.
“The ratings continue to positively factor in SPCPL’s status as the flagship company of the Shapoorji Pallonji Group (SP Group), having a well-established presence in the construction, real estate and infrastructure businesses,” ICRA said. Shapoorji Pallonji was the first Indian construction company to enter the Middle East about five decades ago when it had won the global tender for the palace of Sultan Qaboos of Oman.
Shapoorji Pallonji International (SPINT) is the global arm of Shapoorji Pallonji Engineering & Construction (SP E&C) for its construction operations outside of India. SPINT has successfully built hundreds of diversified landmark structures worldwide in various segments, including residential, commercial, industrial, healthcare, hospitality, educational and stadiums.
