Taj to re-negotiate Bandra-Kurla project

Indian Hotels had bid for the project under under the chairmanship of previous chairman and managing director, Ajit B Kerkar and was even planning to float a separate company to raise funds. It had quoted a sum of Rs 725.22 crore to undertake the project as against Rs 366 crore and Rs 350 crore by Asian Hotels and East India Hotels. As per the agreement, Indian Hotels was to pay the balance 70 per cent of the amount quoted in form of lease rent at 15 per cent annually or five per cent of the gross turnover, whichever was higher. Though Indian Hotels was to pay a 30 per cent of tender amount to MMRDA, it sought many extensions of the deadline since June this year.

Sources say the board was not in the favour of the project as the former management had not taken the approval of the board before bidding.

In case failure of renegotiation, Indian Hotels will forefeit Rs 5 crore. The hotel project also faced flak from the environmental lobby as it is close to the coastline. A case filed by few green activists is still pending with the Mumbai High Court.

Indian Hotels net down 10%

Indian Hotels has recorded a 10 per cent drop in its net profit to Rs 46.7 crore on a turnover of Rs 249.09 crore for the first six months of 1997-98.

In the same period of the previous year, the company posted a higher net profit of Rs 51.32 crore on a lower turnover of Rs 239.63 crore.Other income during the period increased to Rs 17.34 crore and interest outgo was substantially reduced at Rs 12.68 crore. Depreciation was higher at Rs 14.91 crore and taxation Rs 9.1 crore.