Ajit Gulabchand-led HCC is open to selling more assets in its bid for a leaner balance sheet and more cash. Company’s Switzerland subsidiary Steiner AG, its hill city Lavasa and a few more land parcels in Mumbai Metropolitan Region (MMR) are all up for grabs.
Praveen Sood, group chief financal officer, HCC told FE, that the company is open to selling stakes in allied businesses of the company except HCC. “We are very clear that whatever will bring in money into the business, we are open to selling that, except HCC,” Sood said.
HCC posted a sharp year-on-year fall of 29% in the company’s standalone net profit to R19.38 crore for the quarter ended December 31, 2015. However, the company’s operating profit increased by 27.67% to R233.35 and EBIDTA margins improved to 22.51% against 18.81% in the corresponding quarter, on the back of operational efficiency and cost management.
Steiner AG, a swiss real estate company was acquired by HCC in 2010 in an all cash deal of around Swiss Francs 35 million (close to R150 crore then) as it planned to enter high-rise building construction segment. According to HCC, Steiner AG has secured orders worth CHF 1100 million (R7,237 crore) in past 12 months. In addition to this, the company has secured orders for more than CHF 615 million (R4,046 crore), where the contracts are yet to be signed. With this, the order backlog stood at CHF 1,354 million (R8,908 crore).
Apart from Steiner AG, the company has received interest for joint developments or joint ventures for some of the land parcels in its possession in eastern suburb of Vikhroli and a remote suburb of Panvel, to the north east of MMR. The company has a 50 acre parcel in Panvel and a total of 17 acres in Vikroli in two separate locations. “We are not looking for partnerships, and want to sell the land outright,” Sood said without disclosing the expected valuation for the parcels.
As for Lavasa, Sood said that while the company is open to explore stake sale, the process will be complex, given the size and scale of the project.