PSL in talks for $825 million debt recast

PSL in talks for $825 million debt recast

Steel pipe maker PSL Ltd is in talks with lenders including State Bank of India and ICICI Bank to restructure its Rs 45 billion debt, a company official told Reuters.

PSL had been stuck with excess capacity as gas pipeline projects in India have been delayed, G Gehani, director and company secretary, told Reuters.

Lower-than-expected output from Reliance Industries KG-D6 gas field, off India's eastern coast, has disrupted plans for industrial use of natural gas in India. Under corporate debt restructuring, lenders typically extend the repayment tenure for the borrower and lower the interest rate.

"We make pipes for particular projects. If projects do not come we cannot do anything about it," Mr Gehani said on Friday. The country had planned a natural gas pipeline grid of 30,000 kilometres by 2017.

Wind turbine maker Suzlon Energy and telecom infrastructure services provider GTL Infra are other companies whose debt is being restructured through a similar process.

PSL, which has a market capitalisation of about $40 million, lost Rs 161 million in the December quarter compared to a net profit of Rs 66 million in the period a year earlier.

Copyright @ Thomson Reuters 2013

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