India’s largest textile firm, Alok Industries Ltd is divesting its real estate portfolio to ease debt. The company has signed an agreement to sell 73 acres at a 500-acre land parcel in Silvassa, the capital of Dadra and Nagar Haveli, to a group of manufacturers, and has sold a portion of its commercial building in Lower Parel, central Mumbai.
It is also close to leasing out two floors at Peninsula Business Park, an office building in the same area. These deals will together garner about Rs.70 crore.
According to sources close to the development, the Mumbai-based firm aims to earn about Rs.1,500 crore by selling its property portfolio over the next 18 months. Most of the money will be used to retire the debt of real estate subsidiaries and partly repay the Rs.9,000 crore debt on Alok Industries.
The company’s board has also accepted a proposal to merge Grabal Alok Impex Ltd, a joint venture between Alok Industries and Austria’s Grabal Group, with Alok Industries.
The company aims that after the merger, Alok Industries’ share in Grabal Alok UK Ltd, which runs the Store Twenty One chain of retail stores will increase to 90%.
Alok Industries posted a 64% fall in net profit to Rs.58 crore in the June quarter, compared with the previous three months, on a 25% fall in revenue to Rs.1,646 crore, it said on Friday night. Net profit increased 24% over a year earlier, while revenue rose 50% in the same period.
