From vision to reality: Kalpataru's path to market leadership
A story that began with one man – Mofatraj P. Munot – and his dream, is now a symbol of design, lifestyle, innovation and luxury, spread across millions of sq ft of residential and commercial projects. The Kalpataru group, established in 1969 by Mofatraj P. Munot, now has a legacy of 55 years. And the realty company (Kalpataru Ltd) is poised to list as a billion-dollar market cap entity on Indian stock markets. The name Kalpataru, derived from Sanskrit, translates to ‘wish-fulfilling tree’ or ‘tree of abundance’.
Great homes start with Kalpataru! Supreme quality, with customers’ needs at the heart of every decision, has made Kalpataru one of the most trusted names in the real estate industry. Mofatraj and Parag M. Munot have more than five and three decades of experience, respectively, in the real estate industry. Kalpataru Ltd is a member of a group of companies that consisting of Kalpataru Projects International, Property Solutions (India), Shree Shubham Logistics and their respective subsidiaries, among others. The group has a multinational presence and operates in EPC contracting for power transmission and distribution, oil and gas, railways, civil infrastructure projects, warehousing and logistics and facility management.
Kalpataru Projects International is listed on the NSE and BSE. As of 31 December 2024, the group had more than 29,000 employees globally and a footprint in 75 countries. Kalpataru Ltd, a prominent real estate developer in the MMR in Maharashtra, is present across all micro-markets in the MMR (Source: Anarock Report). It is the fifth largest developer in the MCGM area in Maharashtra and the seventh largest developer in Thane, Maharashtra, in terms of units supplied from 2019 to 31 December 2024. As of 31 December 2024, it had a total of 73 completed projects in the MMR and Pune, Maharashtra. Further, as of 31 December 2024, it had 23 ongoing projects, five forthcoming projects and five planned projects in the MMR and Pune, comprising 23.21 msf, 15.43 msf and 7.81 msf of developable area, respectively.
Showing their commitment and belief in the company, the promoters of Kalpataru Limited infused Rs1,440 crore in March 2025 at Rs517.25 per equity share, which is higher than the upper end of the IPO price band. According to Parag Munot, MD, Kalpataru Ltd: “We believe that the strength of the ‘Kalpataru’ brand and its association with trust, quality and reliability is driven by our track record of delivering quality projects. We have a customer-centric approach and seek to address customers’ requirements and preferences, which in turn enhances our brand recognition”.
Kalpataru has posted strong double-digit growth in pre-sales and collections. Strong pre-sales growth is to be accompanied by the reporting of strong cash EBIDTA margins in the range 35-40 per cent, on account of historical land cost, as per informed realty analysts. For nine months of 2024-25, the company reported a 32 per cent EBIDTA margin.
Excellent response
Kalpataru’s flagship ultra-luxury project Kalpataru One, Worli, received an excellent response. This is a high margin project and will help the company report strong margins in the coming years, say analysts. Kalpataru Parkcity, a township spread over 100 acres, has been planned by six global experts (including a master planner, an architect, a structural engineer and a landscape architect) around one of Thane, Maharashtra’s largest integrated parks, NaMo Grand Central Park, which spans more than 25 acres. Kalpataru Parkcity will have various features and amenities including a school, various high-street retail and food and beverage options, and a place of worship.
On the IPO, the public issue consists of a fresh issue of up to such number of equity shares, aggregating up to R1,590 crore. The company proposes to utilise the net proceeds from the issue towards repayment/ pre-payment, in full or part, of certain borrowings availed by the company and the subsidiaries, as also general corporate purposes. This will bring the net debt/ equity below 2, after the IPO. The cost of the debt is expected to come down by ~150 bps to ~10.5 per cent post IPO from ~12 per cent at present, say analysts. Even Macrotech Developers (Lodha group) had about 1.5x the debt of Kalpataru at the time of IPO but look at where it is today!
Several projects are expected to be completed in 2025-26 and 2026-27, which will result in the accrual of strong cash-flows. In the past few years, Kalpataru Ltd has launched a number of projects. According to Indian Accounting Standards, below-line expenses (brokerage, marketing, overheads, etc) across projects have been booked, leading to accounting losses in the past years, point out analysts. The company has already reported profit for the nine months of 2024-25.
The balance sheet of Kalpataru Ltd, the ‘turnaround story’, has been repaired with promoter infusion and the IPO is expected to further strengthen it. Investors coming in today can benefit from the upside, as the issue is priced around NAV, compared to peers who trade at premium, says an analyst.