Eveready Ind to sell land for Rs 250-275cr to be debt free

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Eveready Ind to sell land for Rs 250-275cr to be debt free

Deepak Khaitan, executive vice president at Eveready Industries India, tells CNBC-TV18 that proceeds from land sale will help bring down debt; however, the company is not in a hurry to sell land.

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Excerpts from Bazaar on CNBC-TV18 Watch the full show » ALSO READ See latest News about Eveready Ind See previous management interviews See what other Experts & Brokerages are saying about Eveready Ind Eveready Ind BSE | NSE 29/05/12 Are Mutual Funds betting on Eveready Ind? Other Stocks in this news Mcnally Bharat Engineering |

Eveready Industries India is planning to sell around 60-70 acre of land in Delhi, Hyderabad and Bangalore to pay debt of about Rs 200 crore. Deepak Khaitan, executive vice president at Eveready Industries India, tells CNBC-TV18 that proceeds from land sale will help bring down debt; however, the company is not in a hurry to sell land.

"We have already approached well-known builders and we are waiting for their response. The land sale will help us to retire our debt totally and the company will become debt free," added Khaitan.

Below is the edited transcript of the interview. Also watch the accompanying video.

Q: Can you clarify on this talk that you might be selling some land in Hyderabad or in New Delhi to retire part of your debt? What kind of plans do you have on this?

A: We have shutdown our Hyderabad plant, which has 25 acre of land. We have been trying to sell this piece of property, which is very valuable. But at the moment, the situation is not really right for property sale.

We have already approached well-known builders and we are waiting for their response. However, we are not in great a hurry to sell the land but it will be hopefully sold in the next 12-15 months. This will help us to retire our debt totally and the company will become debt free.

Q: Which parcels will you look to offload or sell first and how have you valued them?

A: This 25 acre land in Hyderabad would be the first one because we are valuing at a rock-bottom price of selling middle-class housing at about Rs 4000 per square feet, which means that cash inflow is about Rs 1000 crore. So, if you add the interest cost into land cost and construction cost; in a normal market, this land should fetch between Rs 250 to 275 crore. So, we are waiting for that sort of price to come.

However, if it does not happen then, we may go in for development of property ourselves through our sister company McNally Bharat , which is already going into civil construction.

The second piece of plot is in Noida in Delhi, but we don't have our plant there at the moment. However, since property prices in that area are going up, we will have our second plot of 15 acre. So, I am quite sure that Eveready will be able to pare of its debt, which at the moment is about Rs 200 crore.

Also read: Eveready Ind to sell land to pay debt; stock up 7%