HCC to go for debt restructuring, shares up
The proposal to tax customers at policy maturity or EET method will have an extremely adverse impact on life insurance industry.
Hindustan Construction Company (HCC) is likely to enter corporate debt restructuring (CDR) for re-alignment of company's debt. The company cited delay in government decisions and settlement claims for the move. Cash flows have not materialized as expected due to payment delays, the company said today.
The construction company is saddled with Rs 4000 crore in debt and has a debt to equity ratio of 3:1. The lenders meet to discuss the terms of CDR is likely to be held on March 16, sources told NDTV Profit.
Shares of the company traded 3 per cent higher at Rs 27.40 on the National Stock Exchange today.
The CDR mechanism was set up to help companies unable to repay liabilities and it entails extending the repayment period of loans, converting the un-serviced portion of interest into term loans and reducing the rate of interest on outstanding advances.
Sources said that ICICI Bank is the lead bank in the consortium of lenders along with Axis Bank, SBI, IDBI Bank and Canara Bank.