Shares of Nitco Ltd climbed nearly 14% after the tile maker disclosed a land deal in Alibaug with the House of Abhinandan Lodha (HOABL), a transaction that could bring the company as much as ₹1,500 crore over the coming years.

The transaction is expected to generate consideration of approximately ₹1,300 crore to ₹1,500 crore over a period of five years, according to Nitco's exchange filing submitted on Monday. As part of the arrangement, development rights for the Alibaug land parcel have been granted.

Nitco is a Mumbai-headquartered manufacturer of vitrified tiles, wall tiles and marble products, and its shares are listed on India's stock exchanges. The company's Alibaug landholding had long been viewed as a significant asset on its balance sheet, making the disclosure notable not just for the size of the expected consideration but also for how a real estate transaction can affect sentiment around a non-core asset.

HOABL, founded by Abhinandan Lodha, is a real estate firm that focuses on land acquisition and plotted land development, with projects across several Indian locations. Alibaug, a coastal town in Maharashtra's Raigad district, has grown into a sought-after destination for second homes among buyers from Mumbai, drawing sustained interest from developers in recent years.

The sharp move in Nitco's share price followed the company's disclosure to the exchanges, which detailed both the grant of development rights and the phased consideration structure spanning five years. Investors typically watch such announcements for the scale of monetisation, the timing of cash flows and the execution of the transaction, all of which are laid out in the filing.

Source: CNBC-TV18