Lodha Developers Raises ₹500 Crore Through Non-Convertible Debentures at 8.52% Coupon
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Lodha Developers Raises ₹500 Crore Through Secured Non-Convertible Debentures
Lodha Developers Limited raised ₹500 crore through the allotment of secured non-convertible debentures on March 30, 2026, marking another step in its capital management strategy. The company allotted 50,000 debentures with a face value of ₹1 lakh each on a private placement basis.
Instrument Structure and Terms
These instruments are rated, listed, senior and secured, which places them higher in repayment priority compared to unsecured borrowings. The issuance will be listed on the Wholesale Debt Market segment of the National Stock Exchange.
The debentures carry an annual coupon of 8.52%, paid every six months, with the first payout scheduled for September 30, 2026. The maturity is set for March 31, 2036, giving the company a decade-long funding runway.
The debentures are backed by a first-ranking charge on identified assets, which provides security cover to investors and typically helps in pricing such issuances at relatively stable coupon rates.
Use of Proceeds and Strategic Context
The funds will be utilized for capital expenditure, refinancing existing debt, meeting long-term working capital needs, and general corporate purposes, supporting the company's growth strategy.
The fundraising is aimed at diversifying the debt pool, enabling a continued reduction in the cost of funds on targeted debt capital. This issuance is part of a larger approved program: in January 2026, the board of directors approved raising ₹5,000 crore through the issuance of non-convertible debentures on a private placement basis, in one or more tranches, with an enhancement of the borrowing limit from ₹3,000 crore to a maximum outstanding amount of ₹5,000 crore.
Market Response and Balance Sheet Context
Lodha Developers share price declined 3.06% to ₹678.80 as of 12:47 pm IST on March 30, 2026. The share price reaction suggests that investors are weighing the implications of fresh debt.
The company's debt profile remained manageable at the time of the March 2026 board approval of the overall program. As of Q1 FY26, the company's net debt stood at ₹5,080 crore, with a net debt-to-equity ratio of 0.24x, below its target ceiling of 0.5x. The company's exit cost of debt for Q1 FY26 stood at 8.3 per cent, down 40 basis points for the quarter—among the lowest in the industry.
Business Development Activity
The capital raise supports ongoing expansion across Lodha's core markets. In Q1 FY26, Lodha added five new projects across the Mumbai metropolitan region, Pune, and Bengaluru, with a gross development value of ₹22,700 crore. Since its initial public offering in April 2021, the company has added 48 projects with a gross development value of over ₹1 trillion to its portfolio.
Default Provisions
If there is any delay beyond three months in servicing interest or principal, an additional 2% per annum interest will apply over the base coupon.