DHFL Defaults on Rs50 Cr NCD Repayment, Blames 'Moratorium Restrictions'
Bankrupt non-banking financial company (NBFC) DHFL has defaulted on the repayment of Rs50 crore on secured non-convertible debentures (NCD) and has attributed its failure to repay the principal payment to the moratorium restrictions on it.
 
"It may please be noted that the company is currently under moratorium pursuant to Section 14 of the Code since 29 November 2019 and hence, the company is not in a position to make payment of interest or principal to any of the company lenders, including NCDs holders," DHFL said in a regulatory filing.
 
The payments to the lenders or NCD-holders remains in abeyance and will be subject to the outcome of the corporate insolvency resolution process (CIRP) initiated against the company as per the Insolvency and Bankruptcy Code, 2016.
 
Last November, the Reserve Bank of India (RBI) superseded the board of directors of the company and appointed an administrator and accordingly, the board powers were vested in the firm's administrator.
 
Further, the Mumbai-bench of the National Company Law Tribunal (NCLT) commenced the CIRP against the company in December, following an application by the RBI.
 
The company reportedly has debt of around Rs97,000 crore and has allegedly siphoned off Rs31,000 crore from the total bank loans.
 
Company promoters Kapil Wadhawan and Dheeraj Wadhawan were arrested by the Central Bureau of Investigation in April and are currently facing probe.
 
Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.
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    COMMENTS

    hudafshaikh

    1 month ago

    Huge fraud is happening in DHFL currently - the Adminstrator is utilizing the money to make payments against the highly questionable securitization deals entered in by the Wadhawans and these were done in violation of NHB regulations.

    SEBI needs to immediately act against the fraud management which is siphoning off the funds belonging to Secured Debenture Holders.

    rakeshkokkattu

    1 month ago

    Still DHFL is not even giving the bills for the advertisement agencies for the publications done for DHFL in sarfaesi mater's for the month of Sept, October and November 2019. Now the advertisement agencies are facing big issues.

    Ramesh Popat

    1 month ago

    what about AAA ncd holders?

    Yes Bank to auction assets of Gautam Thapar's Avantha Holdings, Oscar Investments
    Yes Bank will auction properties of Gautam Thapar's Avantha Holdings and Shivinder and Malvinder Singh's Oscar Investments Ltd in a bid to recover their dues.
     
    The sale of immovable assets will take place later in the month under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest (SARFAESI) Act, 2002.
     
    The auction notice for the borrower, Avantha Holdings Ltd, wherein Avantha Realty was the mortgager, said that the bank has taken constructive possession of the property mortgaged to it for recovery of Rs 548.30 crore.
     
    The notice described the mortgaged assets as: "All that office premises bearing Municipal No. B-14 to B-19 on the third floor of B-wing of Shangrilla Apartment, Bund Garden Road, Pune - 411 001, admeasuring approx. about 123.56 sq. mtrs. Built-up area, bearing Survey No. 362, Hissa No. 3/A and Hissa No. 4(pt), situated at 31 Bund Garden Road, Pune under the name of Shangrilla."
     
    The loan repayment amount is due since October 31, 2019, along with further interest and cost due to the now restructured private lender from the borrower and mortgager.
     
    The notice said that interested parties may inspect the property from July 10 to July 23, between 12 noon to 5 p.m. with prior information to authorised officer.
     
    Last date and time of submitting Earnest Money Deposit (EMD) is July 24, up to 5 p.m. and the date of e-auction is July 27 between 11 a.m. to 2 p.m.
     
    The auction notice for Oscar Investments Ltd, the borrower and RHC Holding Pvt. Ltd the mortgager, said that immovable assets mortgaged to the bank will be sold on July 20 for recovery of Rs 465.29 crore which is due as on June 29.
     
    The reserve price will be Rs 30 crore and Earnest Money Deposit will be Rs 3 crore, it said.
     
    The properties mortgaged to Yes Bank are: "Land & building built on land admeasuring 12 Bighas out of Khasra No. 288 (4 Bighas 16 Biswas), Khasra No. 289 (4 Bighas 5 Biswas) and Khasra No. 290 (2 Bighas 19 Biswas) situated in the revenue estate of Village Gadaipur, Tehsil Hauz Khas, Mehrauli, New Delhi."
     
    The property will be open for inspection from July 6-17, while the last date to submit the bid along with the EMD is July 18. The e-auction will take place on July 20.
     
    Oscar Investments Ltd is promoted by RHC Holding Private Ltd, which is promoted by Malvinder Mohan Singh and Shivinder Mohan Singh.
     
    Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.
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    COMMENTS

    veereshmalik

    1 month ago

    Curse of the 3rd generation hits another Indian family business again.

    Ramesh Popat

    1 month ago

    why malvider singh and shivinder singh are not taken to task by Govt
    as they have many such bad dealings?

    tillan2k

    1 month ago

    height of optimism Thapar wold have left assets for him????

    Indian Banks Facing Significant Capital Shortfalls: Fitch Ratings
    Indian banks are likely to require at least $15 billion in fresh capital to meet a 10% weighted-average common equity Tier-1 ratio under a moderate stress scenario, says Fitch Ratings. 
     
    In a research note, the ratings agency says, "This rises to about $58 billion in a high-stress situation where the domestic economy fails to recover from the coronavirus pandemic-related disruption. State banks will require the bulk of the recapitalisation, as the risk of capital erosion at state banks is significantly higher than for their privately owned peers." 
     
    "We expect the majority of the injection to come through in FY21-22, as bad loan recognition has been pushed back by a 180-day regulatory moratorium. However, a clearer picture should start to emerge from December 2020, unless the central bank agrees to a one-time loan restructuring, which would affect the timely recognition and resolution of bad loans," it added.
     
    Fitch says it does not believe the reported performance of Indian banks for the financial year ending March 2020 (FY19-20) adequately reflects the incipient stress caused by the pandemic. It says, "The results are broadly in line with our expectations, but bank balance sheets are yet to feel the impact of India's strict lockdown measures that were implemented by the government from 25 March 2020. Moreover, a meaningful short-term recovery looks unlikely, as the acceleration of new COVID-19 cases threatens the gradual reopening of the economy."
     
    The impaired loan ratios of Indian banks trended down in FY19-20 (FY19-20e: 8.5%) compared with 9.3% recorded in FY18-19, in line with the expectations of Fitch, and driven by fewer fresh impaired loans and continued write-offs about 2% of the loans during FY20. Several public sector banks also returned to profitability due to easing credit costs, but the banking sector's return on assets was low at FY20e of 0.22%, the ratings agency says.
     
    According to Fitch, core capitalisation improved by about 90 basis points (bps) to FY20e at 11.3%, mainly due to a $9 billion government equity injection into state banks coupled with lower growth; which implies high risk aversion among banks, particularly those that are state owned. State banks' core capitalisation, on the other hand was about 350bp weaker than that of private banks, despite the fresh equity, leaving their limited capital buffers susceptible to stress.
     
    Fitch says it expects heightened asset quality and earning pressure for at least the next two years, as disruption to business activity and supply chains, as well as shrinking personal incomes, damage banks' balance sheets. 
     
    "State banks were more vulnerable than private banks coming into the crisis, with weaker loss-absorption buffers, and appear to be shouldering a disproportionate share of the burden in bailing out affected sectors," it added.
     
    Fitch says it sees a well-functioning banking sector as supportive of achieving sustained economic growth of 6%-7%, but without timely and adequate recapitalisation, banks will continue to display heightened risk aversion, adding to India's economic uncertainty. 
     
    "We expect the economy to contract by 5% in FY21, followed by a recovery in FY22, but with considerable downside risk to our forecast," the ratings agency concludes.
     
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    COMMENTS

    tillan2k

    1 month ago

    According to news reports Banks have written off loans of 14/15 Lacs crores and is covered up by recapitalisation ... over and over again , this time media exposure has made thing difficult .. It is written off loans which found its way in to the pockets of touts, fixers and NETAS and Lamborghini lootyens Baboo unsold real estate is emblematic of the deeds

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