Rossell India sells stake in Lemon Tree Hotels

Tea planter Rossell India Ltd, has divested its minority stake in three Lemon Tree Hotels at a profit of nearly Rs 14 crore. This stake sale propelled Rossell India into profitability in Q1. It reported a net profit of Rs 13 crore for the April-June (2012) quarter, compared with Rs 3 crore in the corresponding previous quarter. In January-March it had reported around Rs 6 crore net loss. Rossell India had investments of Rs 30 crore in Lemon Tree’s ‘Vembanad Lake Resort’ at Alleppey, Kerala and its upcoming hotels in Delhi and Bangalore. “As we plan to have our own hospitality chain we moved out of Lemon Tree,” N. K. Khurana, Vice-President (Finance) said. Rossell’s Q1 operating profit for the quarter stood at Rs 60 lakh. The company’s stock closed at Rs 37.45, up by over 10 per cent, at the BSE on Friday. Khurana said the company was expecting an increase in tea production following the acquisition of Namsang Tea Estates in Dibrugarh, Assam, in June this year. Namsang, with an annual capacity of 0.7million kg (mkg), was acquired by Rossell for Rs 29 crore from Dhunseri in June this year. Rossell has six tea estates. The company expects to produce 5 mkg this fiscal against last fiscal’s 4 mkg. In Q1 it fetched Rs 30 a kg higher price realisation than last year’s average.