Coffee Day Enterprises defaults on payment of Rs 465 crore

Coffee Day Enterprises, the owners of Cafe Coffee Day outlets, are in trouble after they defaulted on a payment of Rs 465 crore which was due in the June 2023 quarter. In an exchange filing the company said that there is delay in debt servicing is due to liquidity crisis.

Coffee Day Enterprises defaulted payment on two counts –repayment of loans from banks and repayment of NCDs.

A sum of Rs 220.5 crore in the form of loans or revolving facilities like cash credit is due to banks and financial institutions.  While Rs 244.77 crore is due to NCD holders – of which Rs 200 crore is the principal outstanding and Rs 44.77 crore was the accrued interest.

The company, owned by family of late VG Siddhartha, posted a net loss of Rs 380 crore in FY23 on a revenue of Rs 924 crore. The net loss of the company in FY23 trebled from Rs 121 crore loss in FY22.

It is to be noted that one of the stepdown subsidiaries of Coffee Day Enterprises — SICAL Logistics Limited (SLL) – underwent corporate insolvency resolution process. The approved resolution plan of SICAL Logistics, however, had NIL payment provisions to related parties of SICAL. Due to this Coffee Day Enterprises had to write off an amount of Rs 392 crore.

“As per the NCLT order the equity shares held by the Promoter and Promoter group is extinguished and cancelled. Accordingly, Coffee Day’s the investment in Sical Logistics, which is valued based FVTOCI at Rs 7.45 crores, held by two step-down subsidiaries as promoters, is fully written off,” the auditors of Coffee Day have noted.

The resolution plan submitted by Pristine Malwa Logistics Park Private for Sical Logistics Ltd was approved by the NCLT in December 2022. The resolution plan provides for payment of Rs 480 crore against the total creditors claim of Rs 2,155 crore.

Also Read: NCLT approves Pristine Malwa Logistics Rs 480 crore bid for Sical Logistics