Less than two months after Reserve Bank of India (RBI) initiated the most definitive steps to crack the whip on chronic defaulters who account for almost 25 of the bad loans of banks, 10 out of the 12 borrowers are now firmly facing tentative insolvency proceedings.
On Wednesday, the Allahabad bench of the National Company Law Tribunal (NCLT) admitted the petition moved by public sector lender IDBI Bank against Jaypee Infratech and gave its nod to the appointment of an interim resolution professional, according to the Mint.
Other borrowers against whom the NCLT has admitted insolvency proceedings include Essar Steel, Bhushan Steel, ABG Shipyard, Amtek Auto, Electrosteels Steel and Jyoti Structures while two borrowers — Lanco Infratech Ltd and Era Infra Engineering Ltd are awaiting a decision by the NCLT.
The June 13 notification of the RBI paved the way for initiating the next steps by lenders.
On its part, Jaypee Infratech said it won't place hurdles in the way of steps to recover the overdue amount. "Jaypee Infratech has withdrawn all the objections with respect to its admission under the Insolvency and Bankruptcy Code (IBC). This has been done keeping in mind the interest of all its stakeholders including the home buyers and depositors," the company's lawyer R.P. Agarwal was quoted as saying by the business daily.
On Thursday, shares of Jaypee Infratech were quoting at Rs 18.70 apiece, down 4.83 percent from their previous close, on the BSE at around 12.30 pm.
The company's debt stood at approximately Rs 7,900 crore as of March 31, 2017. It's negative interest coverage ratio meant that it was not in a position to repay bank loans, the Mint said.
Among the projects executed by the company is the 165 km Yamuna Expressway that connects Noida with Agra, in Uttar Pradesh.
