India’s Wadia-owned Bombay Dyeing to sell land to Japan’s Sumitomo for $627 million

BENGALURU (Reuters) -India’s Bombay Dyeing and Manufacturing Co Ltd will sell a land parcel in Mumbai for about 52 billion rupees ($626.62 million) to a unit of Japan’s Sumitomo Realty and Development Co, the retail and textiles company said on Wednesday.

The sale of the 22-acre land will help the company record a pretax profit in excess of 43 billion rupees ($518.45 million), Bombay Dyeing said.

It will also help the company extinguish all its borrowings and pay dividends in the future, it added.

Bombay Dyeing, which changed its strategy in March 2022 to also focus on the realty business, will also develop unutilised land parcels of the company to create about 3.5 million square feet of residential or commercial property, helping it to generate revenue of 150 billion rupees over the next few years.

The land sale will help the company fund future realty projects, it added.

Last month, the Mumbai-based company reported a consolidated net loss of 1.20 billion rupees for the June quarter, bigger than 768.2 million rupees a year earlier.

The Wadia group has been facing troubles after its Go First airlines filed for bankruptcy in May, blaming “faulty” Pratt & Whitney engines for the grounding of about half its fleet.

($1 = 82.9855 Indian rupees)

(Reporting by Nishit Navin in Bengaluru; Editing by Maju Samuel)