Mahindra Lifespace to Raise ₹1,500 Crore via Rights Issue for Debt Reduction and Expansion

Mahindra Lifespace Developers Ltd has announced a plan to raise up to ₹1,500 crore through a rights issue, aiming to reduce debt and support future expansion. The company’s board has approved the issuance of shares to eligible shareholders, as stated in a regulatory filing on February 13. The proceeds from this fundraising initiative will be utilized to lower existing debt and finance ongoing and upcoming projects. As the real estate and infrastructure arm of the Mahindra Group, Mahindra Lifespace has been expanding its presence across multiple cities in India.

The announcement comes at a time when the company reported a consolidated net loss of ₹22.47 crore for the quarter ending December 2024. In the same quarter of the previous year, the company had posted a net profit of ₹50.02 crore. Despite the reported loss, total income increased significantly to ₹185.77 crore in the third quarter of this fiscal year, compared to ₹88.77 crore in the corresponding period of the previous year. However, total expenses also rose, reaching ₹200.88 crore from ₹125.12 crore a year ago.

The real estate sector in India had a mixed year, with a slowdown in housing supply but record investments flowing into the industry. Experts believe that demand will stabilize, but sales in 2025 are likely to be lower compared to 2023. With changing market dynamics, companies in the sector have been focusing on maintaining financial stability and securing long-term growth opportunities. Mahindra Lifespace has been actively expanding its development portfolio and strengthening its market position to navigate these challenges effectively.

Mahindra Lifespace currently has a total development footprint of 39.44 million square feet, covering completed, ongoing, and forthcoming residential projects across seven cities in India. The company is also engaged in large-scale industrial developments, with over 5,000 acres of ongoing and planned projects in integrated developments and industrial clusters at four locations. Its focus on urban development and integrated business ecosystems has positioned it as a key player in the real estate industry.

On February 14, Mahindra Lifespace’s stock closed at ₹358.50 on the BSE, reflecting a minor decline of 0.03%. Over the past 52 weeks, the stock has ranged between a high of ₹679.15 and a low of ₹347.00. Investors and market analysts will be closely monitoring the impact of the rights issue on the company’s financial position and long-term strategy.

By raising ₹1,500 crore, Mahindra Lifespace aims to strengthen its balance sheet, reduce financial liabilities, and create a foundation for sustained growth in the real estate sector. The move is expected to help the company navigate market challenges and capitalize on new development opportunities in the coming years.

 Image source- mahindralifespaces.com