DLF shares rise 11% on debut

Shares in Indian real estate firm DLF Ltd. debuted 11% higher than their issue price of Rs525 on 5 July, after the company raised Rs91.88 billion ($2.25 billion) in India’s biggest-ever IPO.

At 0426 GMT, DLF shares were up 6.7% at Rs560.00 on the Bombay Stock Exchange. The benchmark index was up 0.5%.

Analysts had expected the shares to rise 7-12%, with gains limited by concerns over falling property prices, which have eased about 10% in the last four months.

DLF, which received subscriptions for about three times the shares on offer, last month sold 10.27% of the company, or 175 million shares, in an offering heavily bid by large funds, but which just managed full subscription for the 52.2 million shares reserved for small retail investors.

Last year, DLF dropped its plans for what would have been India’s biggest IPO due to a sharp market fall in May and June.

DLF, which built much of the outsourcing hub of Gurgaon on the outskirts of Delhi, plans to spend nearly Rs70 billion to buy and develop property.

Kotak Mahindra and DSP Merrill Lynch were the lead arrangers for the issue, with Citigroup, Deutsche Bank, ICICI Securities, Lehman Brothers, UBS and SBI Capital Markets.