Pune based realty company Vascon Engineers is raising Rs 100 crore through the sale of its non-core assets.
The non-core assets that company plans to sell include few land parcels in Nashik and minority stake in some hotel properties. The proceeds from sale of assets will be used to further reduce debt to sub Rs 200 crore levels.
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"With the infusion of capital and the re-focus on our core business, we are back on the growth track. We are exiting the IT park in Nashik and will also sell our stake in Holiday Inn at Hinjewadi, Galaxy Hotel in Goa and Hyatt on Nagar Road in Pune. Around 60 per cent of the sale of non-core assets had already been done, while the term sheets of half of what remained were done, and the rest will be done next year," said R Vasudevan, managing director, Vascon Engineers.
The company has been through the rough for the last three to four years mainly because of EPC projects that did not work well.
A week back the company had raised Rs 100 crore through a rights issue. The rights issue was closed on July 24 and was subscribed by over 130 per cent, company said. The promoters of the company infused Rs 60 crore through this issue, thereby, increasing the promoter shareholdings to 48.02 per cent from from 38.54 per cent at the end of June 2015.
Of the funds raised through the rights issue earlier, Rs 62 crore will be used to repay debt, bringing the debt down from around Rs 335 crore to Rs 273 crore. The remaining Rs 38 crore will mainly be used to drive Windermere in Koregaon Park and Ela near Magarpatta city in Pune.
In its EPC business, Vascon has a current order book Rs 1,000 crore, most of which is to be executed in the next 24 months. These projects are located in various cities including Pune, Mumbai, Chennai and Lucknow and almost Rs. 800 crore of which will be executed during FY 16.
Vascon will also enter the affordable housing market with projects at Katvi, off Talegaon MIDC, Old Mumbai-Pune Road soon. The company will use the design and build strategy in these projects that will enhance efficiency in time and reduce the cost of construction.
On the BSE today, the Vascon share breached the upper circuit of Rs 23.30 per share.