After seeing erosion of 62.2% on the BSE recently, the country’s second largest real estate company, Unitech, recorded a steep decline of 52% in its net profit at Rs 360.28 crore for the quarter ended March 2008. The company attributed the same to stiffening interest rates, which have touched an all time high in the last six years. The total consolidated income for the January-March quarter declined by 26% at Rs 1,197.13 crore, as compared to Rs 1,627.29 crore in the same period last fiscal.
However, for the financial year ended March 31, 2008 the company’s net profit rose 27% at Rs 1,661.86 crore from Rs 1,305.83 crore in the previous fiscal. Total income rose 26% at Rs 4,280.11 crore in 2007-08 as compared to Rs 3,388.09 crore in the previous fiscal. The board, in its meeting held on Friday, recommended a dividend of 12.5% for 2007-08 fiscal.
Managing director Sanjay Chandra said that Unitech would be raising $1 billion over the next 12 months to invest in hospitality sector. This would include $350 million investment in hotels and additional funds for the company’s Mumbai projects. Lehman Brothers Holdings Inc’s real estate fund had picked up a 50% stake in the first phase of Unitech’s project in Mumbai for $175 million. The company plans to develop 35 hotels with 6,000 rooms in the next five years, “as we already have the land,” Chandra said.
The company would raise $350 million through private equity this year, he said, adding 26-40 % stake would be diluted in the hotel projects. “We will also raise about $800 million in the current fiscal from private equity players to develop real estate projects in Mumbai,” Chandra added. Unitech’s shares closed at 182.80, registering a fall of 2.4 % on the BSE on Friday. The scrips have fallen by 62.2% since the beginning of the year. Rising interest rates have discouraged buyers and led them to defer their purchase further.
? to raise Rs 8K cr for telecom growth
Unitech will be tapping the debt market to raise Rs 8,000 crore to fund its telecom expansion in the next five years, Sanjay Chandra, managing director said. The company would also be selling 26 % stake in its telecom arm to a strategic foreign partner, for which it is in discussion with a few foreign telcos. Unitech was awarded the unified access service license (UASL) last year. It also baggeda pan-India GSM license, has already got the crucial spectrum for five circles and the company is planning to roll out telecom services by the last quarter of the current financial year, he said.