Kalpataru IPO opens for bidding today: Should you subscribe to it?

The initial public offering (IPO) of Kalpataru kicks-off for bidding today, that is Tuesday, June 25. The real-estate company is offering its shares in the range of Rs 387-414 apiece, with a lot size of 36 equity shares and its multiples thereafter. The issue shall be concluded for bidding on Thursday, June 27.

Founded in 1988, Mumbai-based Kalpataru is a real estate development company, which specialises in developing residential and commercial properties, retail spaces, and integrated townships across several Indian cities, including Mumbai, Thane, Panvel, Pune, Hyderabad, Indore, Bengaluru, and Jodhpur.

The IPO of Kalpataru is entirely a fresh share sale of 3,84,05,797 equity shares worth Rs 1,590 crore. Kalpataru raised Rs 708 crore from anchor investors as it allocated over 1.71 crore equity shares at Rs 414 apiece. Its anchor book included names like GIC, Bain Capital, SBI Mutual Fund, ICICI Prudential MF, 360 ONE Group, Aditya Birla Sun Life, Ayushmat and others.

Kalpataru is part of the Kalpataru Group, which includes Kalpataru Projects International, Property Solutions (India), Shree Shubham Logistics, and their respective subsidiaries, among others. Kalpataru has 40 ongoing projects and has completed 70 projects, as of March 31, 2024. Last head, Kalpataru was commanding a grey market premium of Rs 5 per share.

Kalpataru reported a net profit of Rs 5.51 crore for a nine-month period ended on December 31, 2024 with a revenue of Rs 1,699.49 crore. The company clocked a negative bottomline as it clocked a net loss of Rs 116.51 crore with a revenue of Rs 2,029.94 crore for the financial year of 2023-24. The company shall command a market capitalization of Rs 8,524 crore.

Kalpataru has reserved shares worth Rs 15.9 crore for its eligible employees, who will get a discount of Rs 38 apiece. It has reserved 75 per cent of the net issue for the qualified institutional bidders (QIBs), while non-instructional investors (NIIs) will have 15 per cent of the allocation in the issue. Retail investors will have 10 per cent for the allocation in this IPO.

ICICI Securities, JM Financial, Nomura Financial Advisory and Securities (India) are the book running lead managers of the Kalpataru IPO, while MUFG Intime India (Link Intime) is the registrar for the issue. Shares of the company shall be listed on both BSE and NSE on Tuesday, July 01. Here's what a host of brokerage firms say about the IPO of Kalpataru Projects:

Canara Bank Securities
Rating: Neutral
Kalpataru has built a strong brand presence in the premium residential market, driven by its execution capabilities, strategic market focus, and asset-light model. Its business direction appears sound, with value creation expected from deleveraging and promoter capital infusion, said Canara Bank Securities.

"Kalpataru commands a steep P/E multiple of 500.81 times (based on annualised 9M FY25 earnings), significantly above the listed peer average of 66 times and also commands a premium on P/B valuation. Despite strong operating fundamentals, the absence of consistent financial stability warrants caution. We maintain a 'neutral' stance on the issue and wait for upcoming results," it said.
 

Choice Broking
Rating: Subscribe for long term
Kalpataru is an integrated real estate development company involved in the entire project lifecycle—from land acquisition to planning, designing, execution, sales, and marketing. It is a prominent developer in the Mumbai Metropolitan Region (MMR), active across all its micro-markets, said Choice Broking.

"Kalpataru is seeking an EV/sales multiple of 9.3 times, which still trades at a discount compared to peer averages of around 12.5 times. The company’s strong brand allows it to command a premium pricing strategy, reflecting solid pricing power. However, a high debt load introduces financial prudence concerns. We recommend a 'subscribe for long term' rating for this issue," it said
 

Arihant Capital Markets
Rating: Subscribe
With a robust project pipeline of 46.45 million square feet, a strategic 1,886-acre land bank, and strong brand equity built over 55 years, the company is well-positioned to capitalize on sustained demand in the MMR and Pune markets, said Arihant Capital Markets.

Timely monetization and phased development ensure long-term growth visibility, healthy cash flows, and capital efficiency. At the upper band of Rs 414, the issue is valued at a P/BV ratio of 5.4 times, based on Book Value per share of Rs 76.7. We are recommending a 'neutral' rating for this issue," it said.

DR Choksey Finserv
Rating: Neutral
The pre-sales and collections is expected to be stronger in the upcoming years led by completion of ongoing projects. The equity raise and strong operating cash flows will aid in deleveraging of the balance sheet and will support significant savings in interest cost and translate into improved profitability, said DR Choksey Finserv.

"Kalpataru appears expensive compared to a broad set of listed peers operating in the mid-to-high end real estate segment. We understand the earnings of the real estate business can be highly volatile led by the nature and value of the projects developed. We assign a 'neutral' rating to the issue, considering the scope of future developments on the land reserve it owns," it added.
 

SBI Securities
Rating: Neutral
Kalpataru is valued at 9MFY25 annualized EV/Pre-sales multiple of 4.7 times on post-issue capital. It has reported losses in the past largely due to shift in the accounting policy where now revenue is recognised on full completion of projects while expenses related to sales, marketing and administration are charged to profit & loss during the year of incurrence, said SBI Securities.

"Its 55 per cent of the saleable area gets sold in the first year of the launch and 90 per cent of the saleable area gets sold prior to the receipt of occupancy certificate which supports a healthy pre-sales outlook. Its 80 per cent portfolio caters to the high-end & luxury segments as of 9MFY25 which is the fastest growing segment in the MMR. We maintain a 'neutral' view on the issue," it said.
 

Bajaj Broking
Rating: Subscribe for long-term
Kalpataru is one of the leading real estate developers engaging in all key activities associated with realty developments. It posted a bumper top line for FY23 following a special land parcel deal. The group enjoys a niche place as a realty developer in the MMR region. It issued equity shares worth Rs. 400 crore to promoters at a price of Rs. 517.25 in March 2025, Bajaj Broking said.

"The company has turned the corner for 9M of FY25 and the management is confident of further improvements in its financial performance in coming years considering the projects on hand. Though prima-facie the issue appears aggressively priced, well-informed investors may park funds for the long term," it added.