Indiabulls Real Estate share price rallied over 13 per cent on the Bombay Stock Exchange helped by spurt in volume trade after the real estate company unveiled plan to divest stake in Century Limited, the parent company that houses Hanover Square property, London, for Rs 1,807 crore (approx 200 million pounds).
“The company has decided to focus only on Mumbai & NCR markets and hence has decided to divest Century Limited, the parent company that houses Hanover Square property, London,” Indiabulls Real Estate said in an exchange filing.
The company had purchased this property for 161.5 million pounds, which has been recently valued at 189 million pounds. Transaction is subject to the shareholders approval.
Cheering the news, Indiabulls Real Estate shares gained as much 13.40 per cent to hit an intra-day high of Rs 119.70 on the BSE against the previous close level of Rs 105.55. The scrip opened tad higher at Rs 108.50 and touched a day’s low of 107.10. The trading volumes on the counter surged nearly double to 38.58 lakh shares changing hands on the BSE as compared to two-week average of 19.95 lakh shares, till the time of writing this report.
On the National Stock Exchange, Indiabulls Real Estate share price climbed 13.40 per cent in intraday trade to Rs 119.70. The scrip opened higher at Rs 107 against the previous closing price of Rs 105.55.
The company, which has a net debt of Rs 4,590 crore as on March quarter, has decided to disinvest in light of the sluggish London property market amid the uncertainty over Brexit uncertainty. It added that it has decided to focus only on its core markets -Mumbai Metropolitan Region and National Capital Region for sustainable growth, and strengthening of its on-going businesses.. Post this transaction, net debt of the company would reach below Rs 3,000 crore.
Meanwhile, the company has reported a profit after tax (PAT) after minority interest at Rs 108.6 crore during the fourth quarter ended March 31, 2019, while revenue stood at Rs 2,040.6 crore.
For the financial year 2018-19, Indiabulls Real Estate posted PAT and revenue at Rs 504.1 crore and Rs 5,222.9 crore, respectively.