Total outstanding dues owed by electricity distribution utilities or discoms to power producers fell 15.25% to Rs 82,305 crore in May from a year ago. Distribution companies (discoms) owed a total Rs 97,111 crore to power generation companies (gencos) in May 2020, according to the portal PRAAPTI (Payment Ratification And Analysis in Power procurement for bringing Transparency in Invoicing of generators).
Nearly three years after taking control of Infrastructure Leasing and Financial Services (IL&FS), the Uday Kotak-led board of directors on Wednesday said that the overall resolution of the group companies is now likely to stretch beyond the current fiscal. As part of its quarterly update on the progress of the ongoing resolution process, the beleaguered infrastructure firm said that the resolution of around 95 entities, with an estimated debt recovery of Rs 3,000 crore, will take place well beyond March 2022. Of the total liabilities of Rs 99,355 crore, the board has so far addressed Rs 29,030 crore through resolution and cash recovery Another Rs 14,643 crore is expected from applications filed with courts, taking its total recovery to Rs 43, 673 crore or 44% of the total group debt.
Debt-laden IL&FS on Wednesday said it expects to address Rs 58,000 crore or 95% of its estimated debt recovery target by March 2022, reports PTI. In April this year, the group had revised its estimates for aggregate debt recovery to Rs 61,000 crore beyond September 2021. The group's overall debt stood at Rs 99,000 crore, as of October 2018. As of May 31, 2021, Rs 43,600 crore or 44% of estimated recovery have been addressed, the group said.
In its latest update on resolution process, IL&FS has said that the group will complete 95% of the estimated recovery, amounting to Rs 58,000 crore, by March 2022. This indicates the resolution process would spill over beyond FY22 to address the high number of residual entities with low recovery potential. Earlier this year, the board had revised upward the recovery target to Rs 61,000 crore from 56% earlier. Of the total debt of Rs 99,355 crore, Rs 29,030 crore has already been addressed through resolution and cash recovery and another Rs14,643 crore is expected from applications filed with courts. The board has projected an additional Rs 7,700-crore recovery by September 2021 and Rs 6,700 crore by March 2022. This will take the overall recovery to Rs 58,000 crore (95%).
The crisis-hit Infrastructure Leasing and Finance Limited (IL&FS) group has addressed a debt of about Rs 43,000 crore and is confident of addressing an additional debt of Rs 14,400 crore, taking its total debt recovery to Rs58,000 crore by March next year. In a presentation, IL&FS says, "Significant portion worth Rs 50,000 crore of estimated recovery would be addressed by September 2021. We expect to address a debt of about 95% or Rs 58,000 crore out of the estimated recovery of Rs 61,000 crore by March 2022. Since there is a high number of residual entities with low recovery potential, it would remain beyond March 2022. The incremental recovery value in these 89 small entities is worth Rs 3,000 crore and will take some more time and we are exploring all options to address this debt, but cannot put a timeline for the recovery."
The resolution of around 95 entities, with an estimated debt recovery of Rs 3,000 crore, of the beleaguered Infrastructure Leasing and Financial Services (IL&FS) group, will take place well beyond March 2022, the board of IL&FS said in its latest update on the resolution process. According to the Board, by March 2022, around Rs 58,000 crore, or 98 per cent of the estimated amount will be recovered, but a large number of residual entities with low recovery potential would still remain beyond March 2022.
Debt-laden Infrastructure Leasing and Financial Services (IL&FS) on Wednesday said it expects to address ₹58,000 crore or 95 per cent of its estimated debt recovery target by March 2022. In April this year, the group had revised its estimates for aggregate debt recovery to ₹61,000 crore beyond September 2021.
Since taking over IL&FS Group on Oct 4, 2018, the New Board faced significant challenges - Complex corporate structure with 347 entities - 172 domestic, 175 foreign, Rs. 99,000+ Cr debt with very high leverage (debt to equity of 17:1 as of Mar’18), Multiple business verticals, 4 layered structure, presence across 11 countries, Significant intra-group exposure with risks not commensurate to revenue streams, Multiple and diverse stakeholders – Government Cos, State Govts, Indian/ Foreign private players. New Board expects overall recovery of around Rs 61,000 Cr (61%) Recovery estimate includes recovery spanning both, resolution and liquidation. Rs. 43,600 Cr. (44%) of total estimated recovery addressed as of 31 May 2021, Recovery from IBC cases has been 39 % through resolution and 3.5 % through liquidation.
The estimated recovery from the IL&FS resolution process at around 61% of overall group debt is better than the average 39% recovery by lenders under the Insolvency and Bankruptcy Code (IBC) process. According to C S Rajan, MD of IL&FS, the company has managed this through a combination of court-approved sales and settlements. Given that there is no legislative or regulatory regime to deal with group insolvency, the board adopted a multi-pronged approach.
SEBI has restrained IL&FS Securities Services Limited from acquiring any new clients for a period of two in a case related to unauthorised transfer of mutual fund units. The market regulator has also imposed a penalty of Rs 26 crore on the company. SEBI's action is based on a complaint by Dalmia Cement East Limited alleging fraudulent transfer of mutual fund units worth Rs 344.07 crore by Allied Financial Services Pvt. Ltd (AFSPL). Dalmia Group, vide letter dated February 27, 2019, alleged that IL&FS Securities Services Limited, a member of NSE Clearing Limited, was also involved in the fraudulent transfer of the units.