The Hindu Business Line : Pudumjee Pulp: Up on project hopes

Pudumjee Pulp & Paper Mills seems to have a number of non-operational positives under its belt. Dalal Street buzz suggests that the company could finally avoid an excise demand and has taken up a real estate development project.

The company is understood to have successfully appealed before the Customs, Excise & Service Tax Appellate Tribunal (CESTAT) in a case pertaining to duty and penalty demand against it by the excise authorities of Rs 102.11 crore. The company had gone in appeal in November 2005 before the CESTAT, Mumbai, against the department's demand.

According to market sources, the company has identified a total of 100 acres in Pune, which is being planned for development.

Though no confirmation from the company could be had on the issue, persons involved in the project indicated that the 2005-06 balance sheets would elaborate on the proposal. According to conservative estimates, if implemented, the project could fetch anything between Rs 600 crore and Rs 800 crore.

The company's board had cleared a relatively small real estate project in September 2005. The project has already received the necessary permissions and the company has recently taken up its implementation on a portion of the mill land, measuring about 49,000 sq m (approximately 5 lakh sq ft) at Thergaon, Pune. This land, used earlier for storage of raw material, was identified as surplus. This project entails construction of residential and commercial units including space to be let out for information technology/bio-technology outfits. The counter closed Tuesday up more than 4 per cent at Rs 80 on the BSE with a traded volume of 27,187 shares. Traded quantity on the NSE was 13,877 shares. The stock has gained over 15 per cent in the past one week on the BSE. The book value per share of the Rs 143-crore Pudumjee Pulp as on March 31, 2006, stood at Rs 123 on an equity base of Rs 8.2 crore, with reserves at Rs 96 crore.

Jayanta Mallick

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