Realty firm Godrej Properties on Wednesday said it will raise up to Rs 700 crore by issuing 2.15 crore shares to existing shareholders through rights issue Rs 325 apiece, a discount of about 30 per cent.

The company would issue 8 shares for every 29 shares held by shareholders as on the record date, which is August 20.

The issue price has been fixed at Rs 325 per share, which is almost 30 per cent less than the current market rate.

Shares of Godrej Properties, part of Godrej Group, were trading at Rs 456.05 per share in the afternoon trade.

“The company proposes to issue 2,15,38,388 shares on a rights basis to its existing shareholders as on the record date aggregating to Rs 699.99 crore,” the company said in a filing to the BSE.

Promoters had 74.98 per cent stake in the company as on June 30. Mumbai—based Godrej Properties plans to launch the rights issue this fiscal.

This will be the third major fund-raising exercise by the Godrej Properties. The company had launched its initial public offer in December 2009 to raise Rs 468 crore. It had also raised Rs 470 crore last year through Institutional Placement Programme.

In the draft prospectus filed with market regulator Sebi for the proposed rights issue, Godrej Properties said it would utilise Rs 525 crore from the net proceeds towards retiring debt, which currently stands at about Rs 1,600 crore.

“We believe that such repayment/pre-payment will help reduce our outstanding indebtedness and our debt-equity ratio,” the company said in the draft document.

In early May, the company’s board had approved the rights issue aggregating up to Rs 700 crore.

Godrej Properties is developing residential, commercial and township projects covering about 85 million sq ft in 12 cities. It has recently reported more than two-fold jump in its consolidated net profit at Rs 39.47 crore in the first quarter of this fiscal against Rs 17.15 crore in the year ago period.

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