Rajesh Exports' realty plans deferred for 18-24 months

Gems and jewellery maker, Rajesh Exports Ltd, has deferred its real estate development plans by at least 18-24 months on concerns over slowdown in property demand, Chairman Rajesh Mehta told NewsWire18 here.

"This is not a wise time to get into real estate business. We will not get into construction activities for the next one-and-a-half to two years,"said Mehta.

Current land bank of the company is about 100 acres in Bangalore and parts of Kerala, excluding additional 200,000 square feet developable area in the central business district of Bangalore.

Mehta clarified the company has no intensions to sell its land bank as it plans to pursue its realty plans once property demand picks up. "No, we are not looking at selling the land we have. We acquired these lands at a very low cost," he said.

In August, the company had said the value of land in hand was pegged at 8 bln-9 bln rupees and was expected to rise to 14 bln rupees after development. Rajesh Exports has also shelved plans to expand its retail network in the current financial year and will look to add retail stores only next year, Mehta said.

"As of now we have slowed down our retail expansion plans. Maybe we will re-start it next year," he said. Rajesh Exports had plans to expand its branded retail jewellery stores--350 Shubh stores and 150 Laabh stores--over the next four years.

Mehta maintained the company's earnings in 2008-09 (Apr-Mar) would be affected because of the economic slump and financial crisis but declined to detail further.