In no hurry to sell any realty, generate funds: Thomas Cook

Madhavan Menon, managing director of Thomas Cook says the travel company's office at Nirman Point in Mumbai has outlived its utility in terms of space utilisation. However, he assures that this does not represent a decision or a strategy on the part of the company to shed all its real estate.

Menon says the last two quarters have been one the "most harrowing" for the company. Below is an edited transcript of the interview on CNBC-TV18 Q: We do understand that you would be looking to lease or maybe sell some of your properties. Could you just take us through this approval that the board has made and what would it comprise of?
A: I do not want you to read too much into these enabling resolutions. We on a constant basis review our space requirements and any corporate would do this to maximize the utilisation of space. All we have taken is an enabling resolution, which will look at various properties, that we own around the country, to see if we can consolidate some of these properties to allow everybody to sit together.
Just to give an example: our office in Nariman Point in Mumbai has outlived its utility from our perspective in terms of space utilisation. We are looking to see what we can do with that space. But let me assure you this does not represent a decision or a strategy on part of Thomas Cook to shed all its real estate. Q: What are the options? Could that joint venture be an option? Would outright sale be the only option; if you could give us some options on the same?
A: We haven't reached that far and I don’t think there is anything on the table at the moment. Let me give an example of DN Road, there has been speculation that we are shedding DN Road but let me assure this, given the structure of our lease and everything else it would be next to impossible to get rid of DN Road. We have looked at the Nariman Point office. We have advertised it in the newspapers. We are looking at outright sale options there but little else other that that Q: Cumulatively, in terms of any sort of internal estimate that you have, what would you be looking to rake up via possible sale or lease and what would the funds be then diverted towards?
A: When we look at consolidation and one will appreciate in the Mumbai market the options are leasing or buying property. We are at a stage where we are looking at options. We haven’t found the suitable fit as yet. To be honest with you, at this point of time either option that is renting or buying property to meet our requirements in the near future are open options so I would not want to commit at this point of time to tell you what we will achieve because we have just started the process. I do not have an offer on the table in the case of Nariman Point office nor have we identified an office that we can actually purchase or rent as yet. Q: The reason I ask is that you have raised some money earlier but just focusing on the business itself can you just give us a sense of how the Indian operations are doing especially since the rupee has depreciated so much?
A: If one looks at the last two quarters, they are amongst the most harrowing quarters that I have seen despite which let me assure you that from the perspective of Thomas Cook the way we operate in the foreign exchange space, we hedge all our transactions immediately on the conclusion of the transaction so we are not really exposed to rupee depreciation. The area where the rupee depreciation does have an impact is on our customers.
I might add that while on the foreign exchange side we did see some of the retail business slip away with the stabilisation of the rupee over the last 15-20 days we have actually seen some of that business pick up again. On the outbound side, most of the activity actually happened after our booking season was over so most people were committed and had already taken their exchange requirements. I am not sure that the depreciation in its entirety impacted our outbound customers.
Looking forward towards Diwali and the December season, our growth is still double digit. I am not saying that it will match the growth of last year but it is definitely double digit and we are seeing a pick up in bookings over the last couple of weeks. My estimation is that, summer this year will again cross the 20 percent mark in terms of growth over the previous year after factoring in the foreign exchange.