Prestige Estates down 2% in early trade on IPP but rebounds

Real estate firm Prestige Estates Projects fell as much as 2.4 percent in initial trade after the company fixed price band at Rs 161-170 for its institutional placement programme (IPP), which is lower than current market price.

The issue of 4,26,60,210 equity shares will open and close for subscription on January 23, 2012. The company also has a right to allot an additional up to 42,66,020 equity shares in case of over subscription of the issue. Total issue size stands at Rs 725 crore, if the issue gets fully subscribed at higher end of price band.

"Company intends to use the net proceeds of the issue towards prepayment and repayment of existing debt, expanding business operations in Chennai and general corporate purposes," according to prospectus filed with SEBI.

CLSA and JP Morgan are book running lead managers to the issue.

Shares, however, recouped early losses within first hour of trade. At 10:50 hours IST, the stock was up 0.94 percent to Rs 176.80 on Bombay Stock Exchange.

Market capitalisation of the company currently stands at Rs 5,739.65 crore.

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