Victoria Mills

The Victoria Mills was established in 1913 and it had started with a small capital of Rs.4 lakh. It was a composite textile mill producing fabrics for local as well as the international market. In 1997, it sold off its textile unit as a going on concern. Subsequently, the company started trading in textile and exporting value added textile products and garments. However the company found cloth trading activity unremunerative and so the cloth trading activity was reduced, and the company is now a full fledged realty company. It has developed property on the mill land – Victoria House. That is its main source of income now, which comes under ‘other income’.

Yesterday, the company announced that it had sold property admeasuring about 9052 sq.ft. (carpet area) for the value of Rs. 18 cores in the second quarter of 2015-16. And it is this is the sole source of ‘other income’ shown in Q2FY16 numbers. This sale alone helped it end the quarter with a net profit of Rs.11 crore v/s Rs.14 lakh in previous Q2. Tax outgo was at Rs.5 crore on account of the property sale.

The company’s equity is very small at less than Rs.1 crore and reserves is at Rs.19 crore. The stock has a face value of Rs.100 and that explains the price of over Rs.2000. EPS for H1FY16 is at Rs.1119. Yesterday’s stock movement was clearly a momentum on account of this sale.