State-owned Air India expects to raise around Rs 1,000 crore by the end of the next financial year (March 2014) through monetisation of five of its prime properties across India.
These are land beside Baba Kharak Singh Marg in this city, Sterling Apartments in Mumbai, the Air India colony in Kolkata, land on the Sowripalayam road in Coimbatore and some land in Chennai. In addition, four-odd floors of its office in South Mumbai's Nariman Point have been leased to State Bank of India.
This programme was to have got going this year but it appears the ownership documents of a fifth of the properties are not available, delaying the sale plan. However, AI has combined the targets for 2012-13 and 2013-14.
A senior government official said, "We are expecting to get the registration of the Baba Kharak Singh property in February. For all the other four properties, the registry is in our name only."
DTZ, international property consultant for AI's land monetisation, is working on how best to proceed, by sale or renting it out. As the property is government-owned, the final decision on monetisation will go through the airline's board, the aviation ministry and the cabinet, the official added.
Asset monetisation in this financial year has been hinged heavily on the Baba Kharak Singh Marg property but the government could not sell it as the property was not in its name.
Said another senior official, "We bought the property for Rs 15 crore in 1983. However, it took us time to take possession, as there were many encroachments on it. An IOCL (Indian Oil Corporation Limited) petrol pump was the last encroachment and cleared just before the Commonwealth Games in 2010."
Asset sales are critical to turning around the airline, which has debt of Rs 43,000 crore and made losses continuously for four years. Raising Rs 5,000 crore over the next 10 years by asset sales is part of the financial restructuring plan.
A plan to auction a 1,000-odd pieces of art work to gather funds is also not moving ahead. Their cataloguing has not taken place, though a panel of experts was appointed for the job in November.
"The airline management has asked this committee to evaluate each art work over a period of three months, so that their monetary value and importance can be determined. We have yet to figure out the total number of paintings, as they are spread in different offices," said a senior AI official.