Mumbai-based realtor Housing Development and Infrastructure Ltd (HDIL) posted massive loss in the fourth quarter ended March 31, 2013 as it wrote off expenses related to termination of a key project in Mumbai. The firm said Mumbai International Airport Ltd (MIAL) has served a notice of termination on the company for a slum rehabilitation project, citing unsubstantiated charges.
HDIL said it has not accepted the said notice and that its lawyers have advised that such notice of termination is not tenable in the court of law and have initiated legal remedies. However, the firm has written off unrealised cost of Rs 441.98 crore pertaining to the project last quarter. HDIL had got this project in October 2007.
This extraordinary item sunk its bottom-line with a net loss of Rs 279.9 crore for Q4 FY13 compared with a net profit of Rs 107.32 crore in the corresponding period last year.
Hari Prakash Pandey, chief finance controller of HDIL, said, “We have handed over 1,000 apartments on request of MIAL. We will continue to work on 27,000 units as we have all the clearances in place. Our apartments have been ready for the last two years but there are eligibility issues. In the case of Sahar Elevated Road, 1,000 families have already shifted. We will not invest further in the project for Phase II and Phase III unless we have clarity on this case.”
MIAL slum rehabilitation project is the largest city based slum rehabilitation project in India. The mandate for the MIAL slum rehabilitation project was to clear 276 acres of encroached land near the airport of which part of the land was to be picked by HDIL for development. The project requires HDIL to acquire close to 160 acres of land to rehabilitate 82,500 families.
Pandey said, “To date the company has spent close to Rs 4,500-5,000 crore inclusive of all costs. We have replaced rest of the cost either by sales of TDR or by launching residential projects on those sites and we have also sold some land parcels.”
The company's sales have slowed and it is indicated by the fact that its unsold inventory stands at whopping Rs 865.6 crore for FY13 against Rs 381.1 crore in the previous year. Its project specific finance cost has increased by 9.14 per cent year on year.
Most of the sale from last quarter came from Virar. The developer is looking to launch nearly 3 million sft of residential projects across Bandra West, Vikhroli, Kurla and Ghatkopar.
Consolidated net debt stood at Rs 3,821.53 crore as of March 31, 2013. Consolidated debt reduced by approximately Rs 120 crore compared with to Q3 FY13. The debt to equity ratio is 0.4, yet the company’s bank accounts had been frozen in the last quarter due to non-payment.
HDIL’s revenue for FY13 almost halved to Rs 1025.24 crore ($182.3 million) compared with Rs 2009.06 crore in FY12. Net profit for the year nosedived by more than 90 per cent to Rs 73.33 crore ($13 million) compared with Rs 809.83 crore last year. Leave Your Comment