NSEL Proposes Settlement Options
Moneylife Digital Team 04 August 2013

NSEL has proposed a partial payment option. It remains to be seen how the stakeholders view them

The National Spot Exchange Ltd (NSEL), which is facing a payment crisis, today announced plans to implement the settlement of dues in accordance with exchange rules and bylaws. Mr. Anjani Sinha, MD & CEO of the exchange stated that following meetings with the members of the exchange, the buyers/ processors and also the Forward Markets Commission (FMC), the following options have been proposed and the final decision would be taken after due consultation with all stakeholders.

Option 1:

A.      There are 8 members/ processors, who are willing to pay as per the scheduled due date or even earlier. The total amount pertaining to such 8 members is Rs. 2181 crores.

 

B.      There are 13 members/ processors, who have offered to pay 5 % of their total dues every week, if the same is agreed upon. Total amount comes to Rs. 3107 crores approximately. Name of such members are as follows:

 

Sr No

Name of Party

1

Jugger nautes Projects  Ltd

2

MSR Food Processing

3

PD Agro Processors  Pvt Ltd

4

Shree Radhe Trading Pvt. Ltd

5

Sankhya Investments

6

Spin cot Textiles Pvt Ltd

7

Swatik Overseas Corporation

8

Topworth Steels & Power Pvt Ltd

9

Vimladevi Agrotech Pvt Ltd

10

N K Corporation

11

NCS Sugar

12

METKORE ALLOYS & INDUSTRIES LTD

13

ARK Imports Pvt. Ltd.


C.      There are 3 processors with whom negotiation is still going on. The amount pertaining to these parties comes to Rs. 311 crore.

 

1

NAMDHARI FOOD INTERNATIONAL PVT LTD

2

NAMDHARI RICE & GENERAL MILLS

3

LOTUS REFINERIES PVT LTD

 

Option 2:

The exchange is in possession of Post dated cheques (PDC) from various processors amounting to Rs.  4900 crs. against their settlement obligation and balance parties have confirmed payment regularly. While PDCs are a commitment, the payout process may not roll out smoothly in a month’s time. Hence, the market participants have proposed Option 1 as a safer alternative.

 

FMC Officials have also asked for details of Members, Planters and other participants who are not cooperating with the Exchange in resolving the matter related to settlement cycle. The FMC along with other Government agencies would work together to ensure a safe and secure settlement of dues.
Comments
Nilesh KAMERKAR
8 years ago
1)Commodity exchanges provide a platform for speculating on commodity prices.

2)Widespread speculation in commodities has fueled high inflation, which has been difficult to control.

Then would it be wrong to conclude?
That the common man is subjected to inflationary pressures because of these commodity exchanges, rather than benefit from the much talked about price discovery mechanism.
Vinayak Bhimarao Mudholkar
Replied to Nilesh KAMERKAR comment 8 years ago
Thank you for explanation!
Vinayak Bhimarao Mudholkar
Replied to Nilesh KAMERKAR comment 8 years ago
Dear Sir,
As an ordinary investor I would like to ask whether the shaken confidence in commodity markets may lead to lower inflation ?(The commodity transaction tax may also be helpful to curb the speculation)
Nilesh KAMERKAR
Replied to Vinayak Bhimarao Mudholkar comment 8 years ago
Sounds logical, but I do not know sir.
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