Century Textile is very active midcap stock and there are some reports that their land development plans could be in for a bit of a problem.
Investment advisor, S P Tulsian says that Century Textile and Industries owns about 38 acres of land, of which 9-acres belong to Wadia, which was leased out to Century for 999 years.
According to the recent trend, there has been a change of user allowed and permitted by the state government. Therefore, Tulsian believes that Wadia's stand will not have any impact on restraining Century with regard to the development of the total land.
Excerpts from CNBC-TV18's exclusive interview with S P Tulsian:
How do you read this development and do you think there could be serious issues or trouble with Century to go ahead with its real estate development plans?
We must first understand that Century Textile has about 38 acres in all, of which 30 acres belongs to Century Textiles and Industries. The 8-acres, which is adjacent to Century Textile Mills, is owned by Century Staff colony. So about 38 acres of land is involved, of which 9-acres belong to Wadia, which was leased out to Century for 999 years, of which 108 years have already passed. The lease had commenced in 1898.
So what we are now talking about is 9-acres of land. If one looks at the recent trend, there has been a change of user allowed and permitted by the state government. So I don't think that Wadia's stand will have any impact on restraining Century with regard to the development of the total land, whenever they decide to take it up, around March 2007 or thereafter.
At this point in time, you do not foresee any big problems? In a worst-case scenario, will it probably get delayed just a bit?
If one sees the whole land, the 9-acres is not one stretch in this whole 38-acre piece of land. It is fragmented on the entire 38-acres and some land needs to be surrendered to the government for MHADA and for open spaces.
So I do not know if the same can be worked out on this leased premises as it will ultimately be handed over by Century Textile Mills to the government for MHADA. Because in view of the Supreme Court order on open areas, one-third has to be given to MHADA.
Probably, the entire issue can be worked out and Century should be able to find a way to come out of this whole problem. I do not think they will have any problem in the development of the land.
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