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| Patel Engg forays into realty, plans comm development, SEZs |
| Press Trust of India / Mumbai Oct 02, 2009, 13:02 IST |
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As a part of its strategy to unlock the value of its 1,100 acre huge land-bank, Patel Engineering, plans to foray into the realty business and build commercial and residential property, IT parks and SEZs over the next three-years, a top company official said.
"The idea is to unlock the value of our huge land-bank which has been lying with us for nearly 30 years," Patel Engineering's Managing Director, Rupen Patel, said here.
Patel Engineering's present core operations are in the areas of building hydro-power plants, irrigation dams, urban infrastructure and transportation.
Patel Engineering's wholly-owned subsidiary, Patel Realty, will run the real estate business, he said.
The first project would be an 80,000 sq ft commercial property in Mumbai's Jogeshwari area which would be leased out. "This should add Rs 10-crore to our bottomline," Patel said.
The company also plans a one million sq ft commercial development in Jogeshwari which should be ready by Q4 FY 10.
"On completion, this should fetch us Rs 100 crore in rentals," he said.
The big jump for the company will be its one crore sq ft residential and commercial development it is planning in Bangalore where it proposes to set up two Special Economic Zones (SEZs) for IT and IteS companies.
"We are working to get this up and going by 2012," Patel said, without, however, divulging the investment figure for the project.
"We will fund our realty foray through internal accruals," he said.
Cash-flow will be generated through sale of property in the SEZs proposed to be set up in Electronic City in Bangalore, he said.
"Our realty business will begin to impact our balance-sheet positively from next year onwards as the realty monetisation has already started. Over the next five to seven years, we hope to garner over Rs 600-800 crore through sale of our properties," he said.
Patel Engineering has very recently announced a diversification into power through its wholly-owned subsidiary, Patel Energy, and plans to set up a hydro and thermal power plant in Arunachal Pradesh and Tamil Nadu, respectively.
In Arunachal, it plans to set up a 120 Mw hydro-power project while in Tamil Nadu, it plans to set up a 1,200 Mw thermal power plant.
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