Faced with adverse business conditions,Lanco Infratech is restructuring debt worth Rs 7,500 crore,a company official said today.
The debt recast consists of Rs 3,200 crore of fund-based borrowings such as short-term loans and Rs 4,300 crore of non-fund based debt such as bank guarantees,Lanco Infratech Senior Vice President A Narasimhan said.
Lanco Infratech,the holding company of the group that has interests in power,natural resources and infrastructure,has initiated the process of corporate debt restructuring (CDR) as per Reserve Bank of India guidelines,the company said in a regulatory filing today.
The CDR would be only for Lanco Infratech and not for any of its subsidiaries,according to the filing,which didn’t provide any figures. Lanco group’s net debt touched Rs 33,593.5 crore at the end of March 2013.
“Prevailing economic conditions have adversely impacted the performance of the infrastructure sector and more specifically,the power sector,” Narasimhan said. “Pending dues from discoms is close to Rs 3,000 crore. Besides,there are problems due to inadequate fuel supplies and rupee depreciation,among others.”
CDR is a mechanism adopted in India that allows viable companies additional time to meet debt obligations,subject to certain terms and conditions,the company said in the filing.
The company’s loss in the year ended March 2013 widened to Rs 1,073.3 crore from Rs 112 crore a year earlier.