Jaiprakash Associates defaults on repayment of Rs 4,044 crore loan

Jaiprakash Associates Ltd (JAL) defaulted on a payment of Rs 4,044 crore on 30 June 2023. Out of Rs 4,044 crore, the principal amount is Rs 1,660 crore and the interest is Rs 2,384 crore. The amount is owed to 22 banks, including Axis Bank, Bank of Maharashtra, Bank of India, Canara Bank, and State Bank of India.

The company in the exchange filing said that the total borrowing (including interest) of the company is Rs.29,477 Crore, repayable by 2037, against which only Rs 4 ,044 Crore is overdue as on 30June 2023.

Out of the said borrowing of Rs.29,477 Crore, Rs.18,319 Crore will get further reduced on transfer to the proposed Special Purpose Vehicle (SPV) for which the Scheme of Arrangement duly approved by all the stakeholders, is pending sanction of NCLT, it said in the filing.

“As a responsible borrower, the Company has been taking tangible steps to reduce the borrowings. Post the proposed divestment of Cement Business and the restructuring under consideration, the borrowing will get almost to Nil upon implementation of revised restructuring plan,” said Jaiprakash Associates.

It must be noted that the company under the direction of the Supreme Court had deposited a sum of Rs 750 crore in the matter relating to a litigation of homebuyers with Jaypee lnfratech Limited (JlL).

Banks of Jaiprakash Associates were contesting that the amount of Rs 750 crore so deposited by the company and interest accrued thereon be refunded to JAL to enable it to meet its obligations with its lenders.  Supreme Court on 24 March 202L finally decided the issue relating to Rs 750 crore (with accrued interest) deposited by Jaiprakash Associates Limited (JAL/the Company) in favour of the company.

Thereafter NCLT on 7 March 2023 decided that out of the said deposit, JAL will be returned Rs.100.48 Crore along with proportionate interest against which the company has filed an appeal with NCLAT. Appeal has since been admitted.

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