Indiabulls arm to mop up Rs 2,322 crore

The promoters of Indiabulls Real Estate will infuse Rs 2,322 crore in the company by subscribing to warrants. After the issue, the promoter stake in the company will go up by 10 per cent to 37 per cent.

The company will issue 40.3 million warrants to promoters, which will be convertible into an equal number of equity shares of Rs 540 each. After the conversion, the net worth of the company will go up from Rs 4,000 to Rs 6,322 crore.

The company will pump Rs 1,500 crore into Indiabulls Wholesale Services, which is setting up 30 wholesale outlets across the country. These outlets will be set up in tier-II and III cities and will have store sizes of 1,00,000 square feet.

An amount of Rs 500 crore will go into Indiabulls Power Services for setting up a captive power plant to supply electricity to the company's upcoming special economic zone at Nasik, Maharashtra.

A total of 20 million warrants will be issued to the promoter, Sameer Gehlaut, to raise Rs 1080 crore. Another 10 million warrants each will be issued to the other promoters, Rajiv Rattan and Saurabh K Mittal and these will fetch Rs 540 crore.

The joint managing directors, Narendra Gehlaut and Vipul Bansal will be issued 2 million and 1 million warrants respectively, amounting to Rs 162 crore.

"Retail is a large profitable opportunity and forms core part of the real estate business. So we saw massive synergies and thought of getting into this business. We have already started work in some cities'' said Gagan Banga, the company spokesman.

Telecom foray Indiabulls Real Estate said it has applied for licences in 22 telecom circles. "As a standalone business, we see large business opportunities in telecom. We will tie up with suitable partners over a period of time," Banga said.

Banking on the opportunities in telecom and synergies between the sector and real estate, a host of realty players such as Parsvnath Developers and Unitech have announced forays into the telecom sector, as India is among the world's fastest growing telecom markets.

October 1 is the last date for submitting applications for licences.

The shares of Indiabulls went up by 7.32 per cent to close at Rs 615.15 in the buoyant Mumbai market, taking its market capitalisation to Rs 14,142 crore.