Vishal makes net profit in Q4

Vishal Retail has completed the sale of its wholesale and retail businesses for about Rs 700 million

in cash, ending a process to revive the cash-strapped retail company that started in late 2009. The conclusion of the sale makes Vishal Retail the first listed Indian retailer to sell out in the wake of the global economic meltdown. However, the company has posted a net profit of Rs 10.47 crores in the fourth-quarter ended March 31, 2011, compared to a net loss of Rs 128.93 crores in Q4 March 2010. The company’s net sales declined 38 per cent to Rs 157.88 crores as against Rs 254.63 crores in the quarter under review.

During the quarter ended March 2011, the company accounted for an exceptional expense of Rs 2.87 crores towards prior period items. The company had undergone a corporate debt restructuring in the quarter and has written back interest of Rs 76.58 crores.

Meanwhile the company plans to change its name to V2 Retail Ltd and enter into the real estate business for which it is seeking shareholder approval. Vishal Retail has sold and transferred its wholesale trading, institutional sales and franchisee operations to TPG Wholesale, the Indian unit of US-based private equity firm, TPG; and its retail business to Airplaza Retail Holdings, a company owned by the Chennai-based diversified Shriram Group, via a slump sale.