Aditya Birla Real Estate's ₹3,498 Crore Century Pulp & Paper Divestment to ITC Enters Final Stages, Completion Expected in H1 FY2026-27
Aditya Birla Real Estate Nears Completion of ₹3,498 Crore Divestment to ITC
Aditya Birla Real Estate Limited (ABREL) has advanced its execution of a business transfer agreement for the divestment of its pulp and paper undertaking situated in Lalkuan, Uttarakhand, by way of a slump sale to ITC Limited. The Competition Commission of India granted regulatory approval via letter dated 16 December 2025. The transaction was originally agreed on March 31 last year, faced delays due to lease transfer issues and regulatory approvals.
Transaction Structure and Valuation
ITC will pay Aditya Birla Real Estate a lump-sum cash consideration of Rs 3,498 crore. The consideration is subject to certain adjustments as per the agreement. The final stage of the deal hinges on the transfer of leases associated with the pulp and paper unit, after which the acquisition is expected to be formally completed.
Strategic Rationale for ABREL
The divestment is a value unlocking exercise for ABREL and will enable the company to pursue growth opportunities in its core business—real estate. The parent company, formerly Century Textiles and Industries, was renamed to Aditya Birla Real Estate, signalling where the company's heart is—real estate. ABREL develops premium residential housing in key markets, including Mumbai, Bengaluru, the National Capital Region, and Pune, developing land parcels through outright purchases as well as asset-light joint ventures.
In the first nine months of FY2025, the pulp and paper arm clocked revenue of Rs 2,382.50 crore, down 5.34 per cent year-on-year, while in FY24, the segment's revenue stood at Rs 3,375.32 crore. In contrast, ABREL's revenue from its real estate business in 9MFY25 stood at Rs 777.71 crore, with an almost five-fold increase compared to the same period last year, while standing at Rs 832.21 crore in FY24, marking a six-fold year-on-year increase.
Century Pulp and Paper: An Established Asset
Century Pulp and Paper was established in 1984 at Lalkuan in Nainital, Uttarakhand, with an installed capacity of 4.8 lakh metric tonnes per annum. ABREL had been trying to exit the paper business for nearly a decade, with attempts to strike a deal with ITC itself in 2015, and again in 2017 with JK Paper.
Strategic Fit for ITC
The acquisition strengthens ITC's presence in the paper and packaging segment, with estimates suggesting a rise of around 50 percent to over 1.5 million tonnes annual capacity. For ITC, the deal helps diversify its manufacturing footprint geographically, as its existing paper facilities are largely concentrated in southern India, providing a strategic foothold in the northern market while strengthening backward integration for its packaging and FMCG businesses. ITC currently operates four paper manufacturing plants in Andhra Pradesh, Telangana, Tamil Nadu, and West Bengal.
Birla Estates' Real Estate Focus
With over 125 years of legacy, Aditya Birla Group forayed into real estate in 2016 with Aditya Birla Real Estate Limited (formerly Century Textiles and Industries Limited). In FY 2024–25, Birla Estates achieved bookings worth ₹8,000 crore, with eight new projects scheduled to start in FY 2025–26. Upcoming developments have a gross development value (GDV) of over ₹60,000 crore. The company has successfully completed two commercial projects and launched several residential projects, establishing its presence in major cities such as Mumbai Metropolitan Area (MMR), the National Capital Region (NCR), and Bengaluru.