On the first day of the e-auction of its mill land, state-owned National Textile Corporation (NTC) got a bid of Rs 1,152 crore for its 8.37-acre Bharat Mills plot in the Worli area of Mumbai.
This highest bid was 35 per cent more than the reserve price of Rs 750 crore set for the property. The auction will continue tomorrow and on Friday.
Last week, Indiabulls Infrastructure had won NTC’s first e-auction, of the 2.39-acre Podar mill land in central Mumbai last week, at Rs 474 crore.
Indiabulls Infrastructure, DB View Infracon, Peninsula Real Estate Management and Lodha Structure Developers are among the other contenders.
Property experts are worried about the high prices offered by the realty firms. “People are outbidding each other and quoting unheard-of prices for these mill lands. There is no logic or analysis left in the bidding. They can make money only if they can sell the apartments at Rs 40,000-50,000 a sq ft. This will simply add to the premium stock, which has very few takers,’’ said Amit Goenka, national director, capital transactions, Knight Frank, a global property consultant.
However, NTC is elated. “Going by the aggressive mood in the beginning itself, our second e-auction is set to at least repeat the story of the first e-auction. The first e-auction brought us a rate that was double the expectation,” said K Ramachandran Pillai, chairman.
NTC is selling defunct textile mills to raise resources for the revival of 21 potentially viable ones. The public sector company expects to get Rs 5,000 crore through sale of land in the current financial year.
NTC has so far made Rs 4,000 crore from selling the land of 26 defunct mills in Mumbai and other cities since March 2005.