Unveiling the Secrets of Land Deals: Three Companies, Three Disclosure Styles
In the world of real estate, transparency and timely disclosure are crucial for maintaining investor trust. However, a recent series of land deals involving three major Chennai-based companies—Ramco Cements Ltd, Rane (Madras) Ltd, and Sundaram Clayton Ltd—has highlighted the varying degrees of transparency and information provided to the public. Each company, despite being equally well-stocked with independent directors and experts, has adopted different disclosure practices when selling their non-core assets to Prestige Estates Projects Ltd.
Ramco Cements Ltd recorded an exceptional income of ₹505.62 crore in the third quarter of FY25-26, stemming from the profit on the sale of land. The company had been informing the public since November 2024 about its intent to generate around ₹1,000 crore from the disposal of non-core assets. However, it never specified which assets were being sold. On 22nd December, Ramco made a public disclosure stating that it had sold non-core assets for ₹514.90 crore to Prestige Estates Projects Ltd. The annexure to this communication mentioned an absolute sale deed for land owned by the company, but it did not specify which land was sold. To uncover this information, one had to look at the public disclosure made by Prestige Estates, which revealed that the land in question was a 25-acre parcel in Madipakkam, Chennai.
The quality of Ramco's disclosure is questionable, as it required the public to seek additional information from other sources. This raises concerns about the spirit of Regulation 30 of the LODR, which mandates the disclosure of material information. Another point of contention is whether such a significant transaction would have proceeded directly to the sale deed stage without a prior agreement. Additionally, the company should have moved the assets to ‘assets held for sale’ as required under IndAS when it decided to monetize them.
Rane (Madras) Ltd, on the other hand, took a more transparent approach. On 11 April 2025, the board decided to seek shareholder approval to monetize several land parcels in Velachery, Chennai; Peenya Industrial Area, Bangalore; Athipattu Village, Ambattur, Chennai; and Santhegoundanpalayam Village, Pollachi, Tamil Nadu. The postal ballot process was initiated the same day to seek shareholder approval. Once the process was completed, on 17 June 2025, the company informed the stock exchanges that the board had given in-principle approval for the sale of 3.48 acres of land in Velachery, Chennai. This disclosure was made even before the terms were finalized, and only the potential buyer was identified.
On 27th June, Rane (Madras) Ltd announced the signing of the agreement with Prestige Estates for ₹361.18 crore, with the transaction expected to be completed by 30 September 2026. The company has been regularly reporting progress in its quarterly accounts, including additional advance monies received, and has moved the asset to ‘asset held for sale’ during the financial year. This multi-stage process is typical in real estate deals and demonstrates a more transparent approach to disclosure.
Sundaram Clayton Ltd, the third company in this series, informed the stock exchanges on 8 January 2026 about the conclusion of an agreement to sell a 16.381-acre land parcel for ₹535.67 crore to Prestige Estates. The buyer paid an advance of ₹25 crore and committed to completing the transaction by 11 February 2026. However, as of 12 February, there has been no update on the completion of the sale. Unlike Rane (Madras) Ltd, Sundaram Clayton did not inform the stock exchanges when the board gave in-principle approval to scout for buyers or engage in serious discussions with Prestige. This suggests a less transparent approach, as it is unlikely that the deal materialized suddenly without prior discussions.
These three deals, all involving Prestige Estates Projects Ltd, highlight the varying disclosure practices among companies, even when they are all well-advised by independent directors and experts. The transparency in real estate transactions is crucial for maintaining investor trust and ensuring fair market practices. As investors and stakeholders, it is essential to scrutinize these disclosures and understand the full picture of such significant transactions.
In conclusion, while all three companies achieved their goal of monetizing non-core assets, the transparency and quality of their disclosures varied significantly. This case study underscores the importance of clear and comprehensive disclosure in the real estate sector, especially for listed companies.
