India Tourism Development Corp. has divested three out of four hotel subsidiaries of its prime asset, the Ashok Hotel, government sources told NDTV Profit on Thursday. The development emerged on a day when ITDC stock jumped by around 20%.
The divestment is taking place under National Monetisation Pipeline 2.0. The sources added that the monetisation will be executed via the public private partnership route (OMDA model), and private players will handle operations and upgrades.
The plan will be discussed at upcoming Inter-Ministerial Group (IMG) meeting early next week.
Of the subsidiaries, Ranchi Ashok has been transferred to Jharkhand Government for Rs 3.06 crore; Punjab Ashok Hotel (51% stake) is to be transferred to Punjab Tourism for Rs 79 lakh, and Hotel Jammu Ashok is to be handed over to J&K government for Rs 11.09 crore valuation.
Discussions to divest Ashok Hotel's Odisha units in Puri and Bhubaneshwar are at an advanced stage, as per the sources. Valuations for the subsidiaries remain modest, signalling the company's exit from non-core assets.
Moreover, the sources pointed out that focus will remain on cleaning up the balance sheet alongside the broader asset monetisation push.
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ITDC Share Price
ITDC's stock jumped as high as 20% to Rs 529.35 after the announcement. The shares have fallen 9.55% year-to-date, and 4.01% in the last 12 months. No analysts are currently tracking the company, as per Bloomberg data.
About The Company
The India Tourism Development Corporation (ITDC) is a premier Public Sector Undertaking under the Ministry of Tourism, Government of India, established on Oct 1, 1966. Its function include developing, promoting, and managing tourism infrastructure. Shares of the PSU listed on the exchanges in December 2016.
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