On Monday, the Infrastructure Leasing and Financial Services (IL&FS) announced that the company expects to discourse its debt of about Rs 57,000 crore, which is above 50% of its overall debt of Rs 99,000 crore. Of this, the firm expects to resolve around Rs 50,500 crore of its debt by March 2021 and remaining debt of Rs 6,600 crore beyond this fiscal.
IL&FS has met a debt of Rs 17,640 crore as of June 30, 2020, from a combination of completed asset sales, debt repayment to green entities (those which can service their debts), debt reimbursement in non-green entities and available cash balance across the group.
In 2018, a new board has been appointed by the center in IL&FS, led by veteran banker Uday Kotak. The new board also put forward a quarterly plan for this financial year that estimates resolving supplementary debt of Rs 8,800 crore by the 2nd quarter, Rs 18,000 crore by the 3rd quarter, and over Rs 6,000 crore by March 31, 2021 — aggregating to Rs 50,500 crore.
Uday Kotak, non-executive chairman of the group, said that they are bringing out things transparently and out of their reasonable estimate of how things will look as they move forward.
Furthermore, they have put forward to structure an Infrastructure Investment Trust (InvITs) with a target gross value of Rs 13,000 crore. This incorporates three special purpose vehicles where the debt of Rs 5,000 crore has been restructured. The group is also in the final stages of concluding the sale of 15 entities with the intention of nearly Rs 8,500 crore and plans to restructure the further debt of Rs 4,900 crore.
Kotak said the group is facing difficulty in retrieval in its NBFC, Infrastructure Leasing and Financial Service, where funds were given to big companies that are themselves in difficulty.
“We have virtually got zero repayments on some of those large loans. Some of them are more than Rs 1,000 crore or higher,” he said. Also, the covid-19 pandemic has slow downed the advancement in the resolution of the group’s assets though he was quick to express optimism that the firm will be able to meet the resolution plan set for the year.
