Home / Knowledge / News / Textiles / Old textile mills generate funds by selling land
Old textile mills generate funds by selling land
31
May '10
Old textile mills are selling their land to generate huge amounts of cash, thereby, turning their worries into wealth. As rates of land increase in an optimistic economy, India's top-most textile companies are generating additional income streams, by establishing or selling their precious real estates.

In order to increase in-flow of cash and reduce their debt, textile companies such as Bombay Dyeing & Manufacturing, Alok Industries, Century Textiles & Industries and Provogue India are either, developing on their existing land or are selling it for higher price.

During the past one year, property rates in key Indian cities such as Mumbai and Delhi, has nearly increased by two-folds. There are many textile firms that possess huge land banks. But the market provides cash to these firms, only if they have come forward with development plans for these land banks. Bombay Dyeing and Century for instance, comprises of finest and huge areas of land in central Mumbai.

Recently, Bombay Dyeing, that has about 9 million square feet of real estate in Mumbai alone, sold one of its properties to Axis Bank for Rs 7.8 billion. Bombay Dyeing has shifted its mills near Pune and the free land has been allocated for setting up two real estate projects in Central Mumbai.

Meanwhile, construction of two commercial complexes will come to an end in a span of 12-15 months on the Century Textiles' land, spanning across 16 hectares (1.7 million square feet), again in Central Mumbai.

During the colonial British times, most of the old textile mills received huge areas of land for almost free of cost, as the British rule was then keen on developing Mumbai as the textile hub for cotton. Many others have also procured land from British government for a nominal lease for industrial purposes, thereby, helping turn Mumbai in to a key textile manufacturing hub. Textile mills faced closure during the early eighties owing to destructive industrial strike.

However, in the last five years, the Maharashtra government has permitted usage of more land from these closed textile mills for property development. Mill owners therefore, are finally benefiting with this policy as land rates are bouncing back.

At the same time, firms like Alok Industries are making an exit from their real estate portfolio, instead of developing it. The firm is hoping to procure around Rs 7 billion from sales of its four large blocks, including property at Lower Parel, Mumbai, which is their key portfolio.

In the meantime, garment retailer, Provogue India, is about to introduce residential projects in Tier-II cities. Three residential projects will be launched in Indore, Coimbatore and Nagpur by the end of the current year, on land owned by Prozone Enterprises, wherein Provogue is 75 percent stakeholder. The first phase of construction will be spanning across 34 acres of land across these three cities.

But around all this, experts' question that, whether these land banks, which are generating revenue for debt-ridden textile mills, will be merely one-time profit making avenues or will turn into consistent source of earnings for the company.

Fibre2Fashion News Desk - India

Must ReadView All

Apparel/Garments | On 24th Mar 2017

UK online retail sales up 15% in February 2017

Online retail sales in UK have grown by 15 per cent year-on-year in...

Courtesy: Messe Frankfurt

Textiles | On 24th Mar 2017

Over 3341 exhibitors participate in Intertextile Shanghai

More than 3,341 exhibitors from 26 countries and regions participated ...

Apparel/Garments | On 24th Mar 2017

Tiruppur garment cluster hopeful of meeting export target

The Tirupur garment cluster is hopeful of meeting its target of...

Interviews View All

Arvind Saraf
Triveni Sarees

e-Commerce is still evolving fast with constant flux and surprises

Pratik Bachkaniwala
Palod Himson Machines

Fabric processing machines are picking up

Rahul Bhadani
Looksgud

Navigating through catalogues is a bit hasslesome

Lynda Kelly
Suominen Corporation

Suominen Corporation is a manufacturer of nonwovens as roll goods for...

Eric Scholler
Groz-Beckert

The Indian market has huge potential in technical textiles, and by far,...

Larry L Kinn
Suominen Corporation

Larry L Kinn, Senior Vice President - Operations Americas of Suominen...

Ritu Kumar
Label Ritu Kumar

‘Classics will return’ "There are a lot of people wearing western clothes ...

Jay Ramrakhiani
Occasions Elegance Wear

It is believed that by early 19th century, Varanasi weavers had moved away ...

Bani Batra

Bani Batra’s couture wedding collection is inspired by traditional Indian...

Press Release

Press Release

Letter to Editor

Letter to Editor

RSS Feed

RSS Feed

Submit your press release on


editorial@fibre2fashion.com

Letter To Editor






(Max. 8000 char.)

Search Companies





SEARCH

news category


Related Categories:
March 2017

March 2017

Subscribe today and get the latest update on Textiles, Fashion, Apparel and so on.

SUBSCRIBE


Browse Our Archives

GO


eNEWS
Insights
Subscribe today and get the latest News update in your mail box.
Advanced Search