Cos seek to recast Rs 50k-crore loans during April-October

Dec 06 2012, 04:02 IST
Comments 0
SummaryIn a sign of how stressed India’s corporate sector is, loans worth a whopping Rs 50,000 crore have been referred to the corporate debt restructuring cell between April and October this year, on the back of R50,000 crore worth of loans having already been recast in the first six months of the year.

advances as on March 31, 2013, up from 2.8% as on March 31, 2012.

As many as 15-20% of the new cases being referred to the CDR cell are cases seeking a second admission into the CDR cell. A second round of restructuring generally occurs when the first round of restructuring fails to help the company tide through its debt woes. Therefore, it requires further moratorium and debt infusion to revive the business.

Including loans previously restructured bilaterally between banks and corporates (outside the CDR cell), this would raise the tally of cases seeking second restructuring much higher. A recent note from brokerage firm Prabhudas Lilladher, which emerged after a meeting with the CDR cell states that a large proportion (greater than 50%) of the incremental cases being referred now are second restructuring cases.

Single Page Format
Ads by Google

More from Frontpage

Reader´s Comments
| Post a Comment
Please Wait while comments are loading...