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

Pic: Shutterstock

Textiles | On 25th Sep 2021

EU extends GSP plus status for Pakistan with 6 new conventions

The European Union (EU) has extended its general system of...

Pic: Shutterstock

Apparel/Garments | On 25th Sep 2021

Bangladesh seeks Russian support for ensuring direct exports there

Bangladesh commerce minister Tipu Munshi recently sought Russian...

Pic: Boris-B / Shutterstock.com

Retail | On 25th Sep 2021

US’ Halloween spending to reach $10.14 bn this year: NRF

Consumer spending in the US on Halloween-related items is expected to ...

Interviews View All

Gaurav Davda, Jindal Worldwide Ltd

Gaurav Davda
Jindal Worldwide Ltd

Indian MMF sector to become globally competitive

Textile Industry, Head honchos

Textile Industry
Head honchos

Quality & affordability to affect market acceptability of new fibres

Textile Industry, Head honchos

Textile Industry
Head honchos

Strongly believe in 'people first' policy.

Ritu Oberoi,

Ritu Oberoi

Mumbai-based Forsarees is a socially driven business enterprise, working...

Dhruv Toshniwal & Udit Toshniwal,

Dhruv Toshniwal & Udit Toshniwal

Launched a year ago, Fashions Pvt Limited conceptualises and sees D2C...

Shambhu Nath Jha,

Shambhu Nath Jha

Leading research and consulting firm Fact.MR recently launched a report on ...

Jacques Prigneaux, EDANA

Jacques Prigneaux
EDANA

EDANA has been the leading global association and voice of the nonwovens...

Karan Bose, Hula Global

Karan Bose
Hula Global

Hula Global, a leading isolation gown manufacturer in India, has been...

Daniel Odermatt, Ventile

Daniel Odermatt
Ventile

Ventile is a registered trademark used to brand a special high-quality...

Archana Jaju, Label Archana Jaju

Archana Jaju
Label Archana Jaju

<b>Archana Jaju</b>’s Hyderabad-based eponymous label works with artisans...

Ruma Devi, Gramin Vikas Evam Chetna Sansthan

Ruma Devi
Gramin Vikas Evam Chetna Sansthan

<b>Ruma Devi i</b>s a jet-setting promoter of artisans who has empowered...

Suman Nathwani, Suman Nathwani

Suman Nathwani
Suman Nathwani

Designer <b>Suman Nathwani</b> talks about her journey of opening a...

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

Leave your Comments


September 2021

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


Advanced Search