Unitech firms up robust plan to complete Noida projects

With the Noida Authority partially approving the layout plans and building plans of housing projects under development, the Unitech Group management has prepared a robust financial plan to complete pending projects. 

The funding plan relies on a mix of sources including balance receivables from homebuyers, unsold inventory and additional inventory that will be sold to new buyers.

The total cost of completion is estimated at about Rs 11,000 crore for 74 projects located all across India.

Of this, nearly Rs 3,200 crore is expected from from homebuyers, while Rs 8,000 crore is expected to be raised from the sale of unsold and fresh inventory.

The completion of Unitech’s Noida-based projects will provide relief to more than 6,000 homebuyers who have been waiting for more than a decade for deliveries.

The revival of Unitech started in earnest in 2020, when the Supreme Court stepped in to address the situation by appointing a board chaired by retired IAS officer YS Malik. This action was taken after the removal of Unitech promoters – the Chandra family, and the control of the company was entrusted to the newly formed board. The decision came as a response to the realty group's inability to deliver projects within the promised timelines and diversion of funds as reported by the forensic auditors.

In Noida, Unitech has a total of 443 acres of land allotted for its three major projects. While this includes 343 acres at sector 96-97-98, plans have been approved for only 166 acres by Noida Authority. In sector 113, Unitech was allotted 53.53 acres of land, of which Noida has given possession of only about 34 acres. However, the Building Plans for about 09 acres of land have been withheld by the Authority. In sector 117, out of 65 acres in possession of Unitech against allotment and leased land admeasuring about 71 acres, building plans for the proposed phase 7 over an area of about 10 acres have been withheld by the the Noida Authority.

For about 196 acres of land in these three sectors, in respect of which the approvals have been withheld, Unitech Group chairman YS Malik told Business Today TV that the company would apprise the Supreme Court about the matter. “We will seek appropriate directions” from the apex court, he added.

Earlier this April, the Supreme Court had heard the concerns of Noida Authority on the unused land. The Authority informed the Court that it wanted the Unitech Group to return the unutilised or vacant land. However, the court reiterated that the matter of outstanding dues would be decided in due course after hearing both sides. 

Unitech had earlier formally requested Noida Authority to expedite approvals as contract works have already been awarded for the three projects in sectors 96, 97, 98, Sector 113, and Sector 117. Officials further added that "contractors have already been mobilised, site offices have been set up and labour huts have also been constructed, except in sector 117".

"As far as sector 117 is concerned, the contracts have been approved by the Supreme Court and have been awarded and the contractors will be mobilised within one month", the official said.

Unitech reported standalone March 2024 net sales at Rs 114.90 crore, up 2045 per cent annually.

Market regulator Securities and Exchange Board of India (SEBI) has disposed proceedings initiated against Sanjay Chandra and Ajay Chandra, former promoters of Unitech Ltd, due to a lack of detail or evidence on record concerning fund transactions from Unitech to the company subsidiaries. SEBI investigated the case to check whether the Chandra brothers had routed funds to the Indian securities market through bank accounts with UBS AG.

A Delhi court earlier granted bail to Sanjay and Ajay Chandra, in a case of alleged swindling of funds of home buyers. The Chandra brothers were lodged in two separate jails at Mumbai. 

In 2021, the ED filed a criminal case under the Prevention of Money Laundering Act (PMLA) against the Unitech Group and its promoters over allegations that the owners illegally diverted over Rs 2,000 crore to tax havens in Cyprus and the Cayman Islands.