Adani buys HDIL's Mumbai plot for Rs 900 cr

In one of the biggest property deals in the country in recent years, the real estate arm of Adani Enterprises (AEL) has bought a two-acre land parcel in Mumbai from property developer HDIL for Rs 900 crore. The plot is located at the city’s Andheri suburb. It was part of a large mixed-use project being developed by HDIL, sources said.

Earlier this month, AEL said it was exiting real estate business to focus on ports, logistics and resources. The promoters were set to take over the property business. According to sources in the Adani group, the listed entity will transfer this land with other properties to the promoters at a “fair value”.

A HDIL spokesperson declined to comment on the land deal, while an email sent to Adani group did not elicit a response, till the time of going to the press. The sale of the land parcel is expected to help HDIL to bring down its debt, which stood at Rs 4,000 crore in the third quarter of current financial year. The company plans to decrease its debt by 20 per cent by March-end through sale of land parcels and development rights.

The company has already sold development rights in the Goregaon and Andheri areas in Mumbai, from where it is likely to make around Rs 600-800 crore in the fourth quarter of FY12.

“Since demand has not picked up and debt levels have risen in the last few quarters, most developers have to sell off land parcels to reduce debt,” said Ambar Maheshwari, managing director, corporate finance, Jones Lang LaSalle, an international real estate research firm.

DLF, the country’s largest developer sold its special economic zone in Pune to private equity giant Blackstone for Rs 800 crore and sold another property in Gurgaon to IDFC for Rs 500 crore.

“In FY13 and FY14, HDIL’s profit-after-tax would substantially increase on account of revenue from ongoing projects apart from aggressive FSI sale mode,” said Suman Memani, an analyst with Pinc Research, in a recent note.

Adani Infrastructure Development, a subsidiary of AEL, has invested over Rs 2,000 crore in projects in Ahmedabad, National Capital Region and Mumbai to develop more than 40 million sq ft of office and residential properties.

Last year, Adani group bought 50 per cent in a south Mumbai project of DB Realty. Gautam Adani, promoter of Adani group, is also one of the shortlisted candidates to buy fast moving consumer goods major Hindustan Unilever’s former training centre Gulita in Worli in Mumbai. HDIL stocks went up 1.42 per cent to close at Rs 1,14.35 on Wednesday.