Post-default, Suzlon Energy gets relief as lenders agree to Rs 11,000 cr debt recast
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Still, the stocks are trading nearly half the year-high level in February. That too was as much as 96 per cent below the Rs 459.8 peak in early 2008, when the global wind energy sector was booming.
The rupee debt, which is due in 5-6 years, will be recast with a two-year moratorium on interest and principal repayment, after which the loans will be repaid over eight years at a lower rate, the official said.
He added that the loans were taken in the past two-and-a- half years and are being serviced at about 14 per cent interest. He also said the debt is fully secured.
The CDR is unlikely to include its foreign currency debt, but will give the company a much-needed breathing space.
Though the details about the capital infusion by promoters are yet to be worked out, the CDR cell has been demanding a 25 per cent capital infusion, and if accepted, Suzlon will have to pump in Rs 2,750 crore as fresh equity for the deal to be concluded.
The demand from banks for higher equity contribution comes in the wake of rising default on even on the recast loan.
Suzlon is the latest big domestic company to get the CDR approval. Already the number of CDR cases have crossed 100 totalling around Rs 67,000 crore this fiscal.
Recently an RBI committee had proposed that banks make higher provisions against restructured loans and as part of the proposal.
The apex bank had on October 30 credit policy upped the provision to 2.75 per cent from 2 per cent. In two years, the central bank wants all such loans declared non-performing and make banks fully provide for.
Early last month, the overseas bond holders of Suzlon rejected a four-month repayment extension the company sought.
The company official said it has an order book of USD 6.8 billion as of now and has an installed capacity of 20,000 MW and 5,000 MW of under installation.