Jindal Iron downgraded to default

MUMBAI, OCT 30: The Credit Rating Information Services of India Limited Crisil has downgraded Jindal Iron and Steel Company Jisco to the default category. 8220;The rating assigned to the Rs 460 crore debenture programme of Jisco has been downgraded from BB8217; to D8217;,8221; Crisil said in a statement. Crisil downgrades a company to D8217; category when it is in default or likely to default in repayment of principal and interest.

JVSL loan rescheduled:
Meanwhile, financial institutions had recently agreed to bail out Jindal Vijaynagar Steel8217;s JVSL 8211; another company in the Jindal group 8211; interest cost of Rs 623 crore following the delay in commissioning its plant. FIs had decided to convert the interest payment to term loans, optionally convertible debentures or any other instrument, sources said. Institutions also agreed to reschedule the loan repayment period of JVSL. While other steel companies were given only five years to repay loans, JVSL was given 12 years to repay loan.

8220;Although the loanrepayment period is nine years, there is a moratorium of three years on repayment. This is very liberal when compared to other steel projects. This is at a time when FIs have refused to consider fresh loans to steel projects,8221; sources said. The JVSL project is already delayed and the project cost has shot up by Rs 922 crore to Rs 6,144 crore.