Tata Communications today rose almost 2.5% to Rs.654 and continues to remains firmly in the green around the same levels.

The new development in the stock is that the Cabinet yesterday cleared the transfer of administrative control of Hemisphere Properties India Ltd (HPIL) from the telecom ministry to the housing and urban development ministry. This is being done through an equity infusion of Rs700 crore and Rs51 crore secured loan into the company.

As a special purpose vehicle (SPV), HPIL is managing the transfer of surplus land from Tata Communications, formerly Videsh Sanchar Nigam Ltd (VSNL), to the government.

This is good news as it looks like the process which began 16 years ago is finally reaching the culmination point.

In 2002, when Govt divested stake in VSNL, which is now Tata Communications, the rich 773.13 acre of surplus land scattered in the country would not be part of the deal. This surplus land was demerged into the realty company, HPIL in 2005. Thus what we are seeing now is the last lap of that divestment journey which began 16 years ago. It’s a sense of relief on the counter of Tata Communication.