The West Bengal state government has taken a significant decision to reclaim a portion of land leased to Nicco Parks & Resorts Ltd. The action, which takes effect immediately, involves the repossession of 1.4 acres from the total 40 acres of land leased to the popular entertainment company.
Details of the Land Repossession
According to an official stock exchange filing made by Nicco Parks & Resorts on Thursday, the state government has decided to repossess specific parcels of land that together measure 1.4 acres. The company disclosed that this land was previously used to operate a segment of its food and beverage operations, along with other recreational activities.
The company's board of directors convened a meeting on Wednesday to discuss this development. Nicco Parks is jointly owned by the Nicco Group, the West Bengal state government, the Bandhan Bank employees' trust, and several private promoters.
Financial Impact and Company Statement
The reclaimed land contributed approximately Rs 7 crore in revenue during the last fiscal year, representing about 9% of the company's total turnover. Despite this significant revenue contribution, the company assured investors that the repossession will not impact its net worth.
In its filing, the company stated: "Such repossession of land will not have any impact on the net worth of the company except for the value of certain depreciated assets." This suggests that while the company will lose the revenue-generating capacity of this land, the financial impact on its overall valuation will be limited primarily to the written-down value of the assets located on the reclaimed property.
The immediate effect of this government decision marks a notable change in the company's operational landscape, though the full long-term implications for Nicco Parks' business operations in Kolkata remain to be seen.
