Bombay Dyeing to prepay debt of Rs 500 crore, aims to be become debt free by 2021
today Dec 6, 2018
Bombay Dyeing, the textile arm of the Wadia group is aiming to be debt free in the next two-three years and will start pre-payment of its debt of more than Rs 500 crore ($73 million) before the end of the current fiscal.
Bombay Dyeing’s total debt has increased by 17 percent annually to Rs 2,730 crore over the last five years while its revenue grew a meagre 1.5 percent in the same period.
The company will invest its cash flows from the realty business to cut down on its debt and expected to raise around Rs 500 crore in sales.
“We are expecting pre-payment of more than Rs 500 crore from two towers in the Mumbai as we start booking revenues from sales of two towers in the Mumbai in the current fiscal year and plans to become debt free in the next two-three years,” Vishu Peruvemba, the company's chief financial officer, told the Economic Times.
“Our debt level has increased in the past five years as we took conscious decision to increase debt funding as it raised at a much attractive price compared with the cost of equity,” added Peruvemba.
Bombay Dyeing is planning massive expansion across India and will be adding 100 franchise stores and expects to generate revenue of Rs 500 crore (approx $73 million) by 2020.
Bombay Dyeing currently has 27 company-owned stores; 3,000 multi-brand stores and over 400 franchise stores across India besides all the major e-commerce platforms.
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