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Private equity firm WSI WSOI V Mauritius Investors, which is an affiliate company of Walton Street Capital, divested its entire 14.27% stake in Shriram Properties for Rs 134 crore. through an open market transaction. The entire stake was acquired by Aurum Real Estate Developers, according to the block deal data available on the National Stock Exchange (NSE).
During the December quarter, WSI WSQI V Mauritius Investors held over 2.42 crore shares, equivalent to a 14.2% stake in Shriram Properties at an average price of INR 55.05 apiece, totalling INR 134 crore. All these shares were bought by Aurum.
Shriram Properties is a leading residential real estate development company that primarily focuses on the mid-market and affordable housing categories, mainly in Bangalore, Chennai, and Kolkata. It completed 36 projects with a saleable area of 20.6 million square feet, mostly in Bengaluru and Chennai, and has a strong development pipeline, consisting of 51 projects with an aggregate development potential of 53 million square feet, as of December 31, 2022.
The sale of WSI WSOI V Mauritius Investors' entire stake in Shriram Properties to Aurum Real Estate Developers reflects the latter's confidence in the growth potential of the real estate development company. The acquisition may also provide Aurum with a significant presence in the Indian residential real estate market.
Shriram Properties is a subsidiary of Shriram Group, a conglomerate that operates across various industries such as financial services, insurance, and real estate. The company has a presence in Bangalore, Chennai, Coimbatore, Kolkata, and Vizag, and is planning to expand to other cities in South India. Shriram Properties focuses on providing affordable housing options, and some of its projects include Shriram Grand City, Shriram Rainforest, and Shriram OneCity.
Shriram Properties' initial public offering (IPO) in December 2021 was oversubscribed by 11.5 times, reflecting strong investor interest in the company's growth potential. The company raised INR 600 crore through the IPO, which it plans to use for debt repayment, land acquisition, and other general corporate purposes.
The real estate sector in India has been on an upward trajectory in recent years, driven by the government's initiatives such as the Pradhan Mantri Awas Yojana, which aims to provide affordable housing to all by 2022. The sector is expected to grow at a compound annual growth rate of 17% from 2020 to 2025, driven by increasing urbanization, rising disposable incomes, and changing demographics.
Overall, the sale of WSI WSOI V Mauritius Investors' entire stake in Shriram Properties to Aurum Real Estate Developers is indicative of the positive outlook for the Indian residential real estate market and reflects the confidence of investors in the growth potential of the sector. It is worth noting that private equity firms often exit their investments after a certain period to realize their returns, and WSI WSOI V Mauritius Investors' exit from Shriram Properties is a typical example of this.
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