Take a train on the Central Railway in Mumbai, and head towards the city’s north-eastern suburbs. Once you reach a station called Ghatkopar, step to the door or look out of the window—on both the east and west sides of the tracks.
The 4-5 km stretch between Ghatkopar and the next station, Vikhroli, houses the factories of the Godrej group, where everything from locks to chemicals to office furniture is made.Few are willing to hazard an estimate of the amount of land that the Godrejs own in Vikhroli, with guesstimates varying in the range of 2,500 and 8,000 acres.
The Godrejs, for their part, are in no mood to oblige. “At this point, I can only say we have a lot of land. There are political and regulatory issues and only once we sort them out can we say exactly how much land we own in Vikhroli,” says Adi Godrej, Chairman of the Rs 7,200-crore Godrej Group.
Ask Jamshyd Godrej, Chairman, Godrej & Boyce, the group’s holding company (who’s also the cousin of Adi Godrej), whether 7,000 acres is a fair figure, and all he’s willing to say is: “It will be around half that figure.”
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Even if you assume the figure at the lowest end that’s being bandied about—2,500 acres—at the prevailing rate of Rs 3,500 per sq. ft in Vikhroli, the Godrejs are sitting on property worth close to Rs 40,000 crore.
That would put the group, which is till date best known for its Rs 800-crore consumer goods entity Godrej Consumer Products Ltd (GCPL), in the league of the country’s top tier of property developers.
If you assume that the Vikhroli land bank is spread over 8,000 acres, its value would be a mindboggling Rs 1.21 lakh crore.
That will easily make the Godrejs one of the most valuable companies in the real estate sector—the current numero uno is DLF, whose land bank is estimated to be worth Rs 1.2-1.35 lakh crore. Such a land holding will also be adequate to propel the group into the elite group of Indian mega-corps.
The only caveat? Much of that value is still notional, and a long way from being unlocked. Thanks to archaic laws that still prevail, like the Urban Land Ceiling & Regulation Act (ULCRA) and Forest Land Regulations, Godrej is in no hurry to realise the value in Vikhroli. (If he does so, as per ULCRA he will have to part with a portion of his land to the state government).
Still, Godrej isn’t waiting for things to happen. Via a company called Godrej Properties Ltd (GPL)— which will soon make a public offer to investors—the group Chairman has slowly but surely flagged off his real estate venture. As of September, GPL had projects—in progress and signed—on close to 200 acres of land.