Baroda Rayon Corporation Secures Rs 100 Crore Loan from SBI for Real Estate Project
Baroda Rayon Corporation Limited (BRCL) has secured a Rs 100 crore loan from the State Bank of India (SBI) to fund a commercial real estate project, marking a strategic pivot from textiles to property development.
Baroda Rayon CorporationSbiReal EstateLoanSurat Textile BourseReal Estate NewsMay 28, 2025
The loan facility is structured as a secured term loan with no outstanding amount as of the agreement date, signifying the commencement of a new funding cycle. BRCL has pledged substantial collateral to secure the facility, including a first charge hypothecation of the project’s movable assets, stocks, and work-in-progress. Additionally, SBI holds a first charge lien on the cash flows and receivables from the Surat Textile Bourse (STB) Phase 1-Part B project.
As part of the security arrangement, a first charge registered mortgage has been created over 197 units in STB Phase I Part B, covering approximately 52,117.12 square meters. Further strengthening the collateral structure, BRCL has also extended security over nine plots of land totalling 15,795.49 square meters, owned by Sejima Texyarn Pvt Ltd. The loan is additionally backed by personal guarantees from Mr. Damodarbhai Bhimjibhai Patel, Mr. Viral Damodarbhai Bhavani, and Mrs. Vidhya Viralbhai Bhavani, along with corporate guarantees from Sejima Texyarn Pvt Ltd and Kanchenjunga Texturisers Private Limited.
Originally incorporated in 1958, BRCL was engaged in the manufacturing of Viscose Filament Yarn and Nylon Yarn until its textile operations were discontinued in August 2008. Since then, the company has focused on leveraging its strategically located land assets in Surat, a city renowned for its textile and diamond industries, for real estate development. Listed on Indian stock exchanges, BRCL maintains its registered office in Surat, Gujarat.
The company’s stock currently trades at a Price-to-Earnings (PE) ratio of 19x, compared to the industry average of 36x, and reports a Return on Equity (ROE) of 3 per cent. BRCL holds a market capitalisation exceeding Rs 300 crore, with its stock up 12 per cent from the 52-week low of Rs 120.30.
Frequently Asked Questions
What is the purpose of the Rs 100 crore loan from SBI to BRCL?
The Rs 100 crore loan from SBI to BRCL is designated for a commercial real estate project, reflecting the company’s strategic pivot from textiles to property development.
What collateral has BRCL pledged to secure the loan?
BRCL has pledged substantial collateral including a first charge hypothecation of the project’s movable assets, stocks, and work-in-progress, a first charge lien on the cash flows and receivables from the Surat Textile Bourse (STB) Phase 1-Part B project, a first charge registered mortgage over 197 units in STB Phase I Part B, and security over nine plots of land owned by Sejima Texyarn Pvt Ltd.
Who are the personal and corporate guarantors for the loan?
The personal guarantors for the loan are Mr. Damodarbhai Bhimjibhai Patel, Mr. Viral Damodarbhai Bhavani, and Mrs. Vidhya Viralbhai Bhavani. The corporate guarantors are Sejima Texyarn Pvt Ltd and Kanchenjunga Texturisers Private Limited.
What was BRCL's original business, and when did it pivot to real estate?
BRCL was originally incorporated in 1958 and engaged in the manufacturing of Viscose Filament Yarn and Nylon Yarn until its textile operations were discontinued in August 2008. Since then, the company has focused on real estate development.
What is BRCL's current market capitalisation and stock performance?
BRCL holds a market capitalisation exceeding Rs 300 crore. Its stock currently trades at a Price-to-Earnings (PE) ratio of 19x, with a Return on Equity (ROE) of 3 per cent. The stock is up 12 per cent from the 52-week low of Rs 120.30.
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