HCC shares extend fall on stake sale in Mumbai asset

After sliding 5.5 per cent on Tuesday, the share price of Hindustan Construction Company (HCC) plunged further 13 per cent in the afternoon trade on Wednesday.

The scrip is looking under pressure after the company announced earlier this week that it has sold its entire 26 per cent stake in Vikhroli Corporate Park, which owns the premium commercial building '247 Corporate Park' in Vikhroli West, Mumbai.

The deal, inked with Blackstone Purchase Entitities, is valued at over Rs 1,000 crore, which includes assumed debt, resulting in net cash inflow of approximately Rs 200 crore to HCC.

"This completes our first real estate development resulting in positive cash flow of over Rs 500 crore in total for the HCC Group over the lifecycle of this commercial property. This transaction is an integral part of our plans to moneise our non-core assets to further reduce our debts. This funds will be used to pare our debts," Rajgopal Nogja, group chief operating officer, HCC, said.

In the financial year 2010-11, HCC Group had raised around Rs 300 crore when it had sold its 74 per cent stake to ILFS Milestone Fund.

At 2.08 pm, the share price of the company was at Rs 23.80, down 13.27 per cent against its previous close.