Indiabulls Real Estate profit drops as it seeks to exit business

Indiabulls Real Estate, which is seeking to exit the business ahead of the proposed merger of Indiabulls Housing Finance with Lakshmi Vilas Bank, has reported a sharp decline in its net profit during the fourth quarter of 2018-19 to Rs 109 crore from Rs 2,181 crore in the same period of the previous year. The revenue from operations dropped to Rs 1,822 crore from Rs 4,944 crore while total expenses came down to Rs 109 crore from Rs 2,181 crore in the same period, the company said in a statement.

The Indiabulls Group has reportedly sounded out joint venture partner Blackstone Group and other leading developers like Godrej Properties to offload its stake in Indiabulls Real Estate. The promoters' stake in Indiabulls Real Estate stands at 38.8 per cent. Indiabulls Group Chairman Sameer Gehlaut recently said that the real estate business has significantly shrunk.

Last year, Blackstone had bought a 50 per cent stake in Indiabulls Real Estate office properties One Indiabulls and Indiabulls Finance Centre in central Mumbai for 730 million dollars (about Rs 5,088 crore). Over the past year, the company has been streamlining its real estate portfolio by exiting the office and residential projects in markets like Chennai.

Indiabulls Real Estate was incorporated in 2006 with focus on construction and development of residential, commercial and special economic zone projects across major metros. To grow its footprint internationally, it branched out to London with some marquee projects in upscale central London.

On April 5, private sector lender Lakshmi Vilas Bank and Indiabulls Housing Finance announced a merger plan in an all-stock deal. The merged entity, to be called Indiabulls Lakshmi Vilas Bank, will be among the top eight private banks in India by size and profitability. The plan is awaiting regulatory approvals.

(With inputs from agencies.)