Another such kind of Business is NESCO ltd. It takes advance as security deposit for the commercial spaces which it rents out + the fee for exhibition is also taken in advance.
Issue is not with Floats but what the management decides to do with it. Sometimes, the use of Float is restricted i.e. like refundable Security Deposits that can be kept in FDs etc. Sometimes, it may be customer advances and if those are not utilized correctly, they may end up becoming solid liabilities - So plz take note of that. The Nature of float matters
A measure of Floats must be made against the fixed costs of a business. If fixed costs are high, then during business downturn the expenses will spiral up and the Float wont build\become liability quickly as mentioned in (1) above
No doubts it used to command a premium for this.
The concern now is with work from home becoming the norm, going back to the levels of revenue in foreseeable future looks difficult.
It might be useful to also understand the historical context. The land was allotted to Reliance in December 2006, was supposed to finish in 2010, then got delayed and keeps on getting delayed. I am not trying to belittle the fact that Reliance convention centre may take away business from NESCO, but its also important to understand a bit of history. Some articles below might be useful . Again I dont want to take away the main focus of discussion