Premier Ltd

I have started to see some very difficult to understand fact about the company, I intend to post these here.

1) Indian Railway is paying 4 Cr per acre While company recently sold 150 Acre of same parcel in total consideration of 440 Cr. Has government started paying at market rate or part of payment is not not reported by the company?

Bse Announcement link

Update on the Companyâs land at Dombivali 13 May 2013 10:32
Premier Ltd has informed BSE that the Company currently owns about 68 acres of land at Dombivali after monetization of 150 acres in January, 2013.

Out of the existing 63 acres of land, the Indian Railways are in the process of compulsory acquisition of about 26 acres of land for the Dedicated Freight Corridor project being implemented by it. The total amount expected to be received as compensation for such acquisition is about Rs. 100 cr.

In this connection, the Company has informed that, the Company has received the first tranche payment of Rs. 27 cr. towards such acquisition.

Updates on Agreement with Horizon Projects Pvt. Ltd
28 Mar 201314:12
With reference to the earlier announcement dated January 16, 2013 regarding the development of the Companyâs 150 acre land at Dombivli, Mumbai with M/s. Horizon projects Pvt. Ltd. The Company has received Rs. 220 cr. as part consideration for this transaction and was to also receive additional consideration of built up flats aggregating to 5,00,000 sq.ft., Premier Ltd has now informed BSE that after consulting with its various stakeholders, as well as considering various economic factors including the situation in the real estate market, the Company has decided to take the balance consideration in cash rather than the 5,00,000 sq.ft. of built-up flats. This amount has been finalized at Rs. 220 cr., receivable in full on December 31, 2014. The Company holds adequate security to ensure this payment on the due date.

Agreement with Horizon Projects Pvt. Ltd.,part of the Runwal Group 16 Jan 2013 13:42
Premier Ltd has informed BSE that the Company has entered into an agreement with Horizon Projects Pvt. Ltd., part of the Runwal Group, to develop an Affordable / Middle Income Housing project on 150 acres (out of 218 acres) of its land at
Dombivli, Mumbai. The Company will continue to retain the balance 68 acres (218 - 150) of its land.

The Company has received Rs.220 Cr. as part consideration for this transaction. In addition, it will receive built up flats aggregating to 5,00,000 sq.ft. in the said project, The Company, if it so decides, has the option to swap this area for a cash payout in 24 months. There is no additional financial outlay required to be made by the Company in this project.

The Company has utilized the above proceeds to pay certain State Government dues linked to the land and will utilize the balance to repay its corporate debt.

2) How market reacted around this announcement link

In India all real-estate deals have major portion in black… so this is quite expected…

The other thing to look here is how the gross block has increased over the years. It seems they have been capitalizing things and might be hiding losses.