The Board of Directors of Arvind SmartSpaces Limited (ASL) at its meeting held on the 10th of September 2021 has approved the allotment of 68.5 lac equity share aggregating to about Rs. 85 crore to HDFC Capital Affordable Real Estate Fund-1 (H-CARE 1) and the promoters of ASL at the price of Rs. 124/- per share as per SEBI ICDR Regulations 2018.
Over the last few years, ASL has grown its project portfolio rapidly. The equity raised in this round will give strong impetus to this growth initiative and further strengthen the balance sheet. The investment by H-CARE 1 is testament to the resilience of the real estate sector and a recognition of the fact that corporate branded real estate companies with strong balance sheets are well poised to capitalize on emerging opportunities in the real estate space.
Speaking on the investment, Mr. Sanjay Lalbhai, Chairman of Arvind SmartSpaces Ltd. said "We are extremely happy to have HDFC Capital Advisors Limited as our strategic partner. This infusion of long term patient capital into the company will give us the flexibility to pursue strategic growth across all the segments that we operate in. The enhanced equity base and low leverage gives the company significant headroom to raise further capital to pursue value accretive opportunities. This coming together of two of the most trusted brands and businesses in India, "HDFC" and "Arvind" will create tremendous value for all our stake holders."
Commenting on the preferential issue, Mr. Vipul Roongta, MD and CEO of HDFC Capital Advisors Limited said, "This investment is an extension to our existing partnership, platform set up in 2019, with Arvind SmartSpaces. It meets our objective to provide long-term, equity and mezzanine capital to marquee developers for the development of affordable and mid-income housing in India. Further, this is in line with HDFC Capital's strategy of partnering with top rated developers with a good track record of development and delivery. We believe that consolidation in the residential sector is a given and that developers with strong brand presence shall capture a disproportionate share of the market."
Mr. Kamal Singal, MD and CEO of Arvind SmartSpaces Ltd. said, "The Company feels that there is a huge opportunity in real estate development in India especially in the post pandemic era. Organized developers with long term and organized capital are in a unique position to deliver customer centric products and solutions on a sustainable basis. This partnership will not only provide resources to pursue growth but also help in building the business further by leveraging the brands and legacy of trust that both the partners bring to the business."
The conclusion of the transaction is subject to necessary approvals from the shareholders of ASL and SEBI.
Metta Capital acted as the exclusive financial advisor to ASL for this transaction. Wadia Ghandy acted as the legal counsel to ASL for this transaction & AZB acted as the legal counsel for HDFC Capital Advisors Limited.
Shares of Arvind SmartSpaces Limited was last trading in BSE at Rs. 148.2 as compared to the previous close of Rs. 150.55. The total number of shares traded during the day was 21673 in over 884 trades.
The stock hit an intraday high of Rs. 152.75 and intraday low of 146. The net turnover during the day was Rs. 3220202.