In just two months, Housing Development and Infrastructure Limited (HDIL) share price has hit a new low, sparking fears of fresh trouble for the Mumbai-based real estate developer. The latest crash took place on Wednesday as rating agency CARE Ratings downgraded the company’s R2,095-crore non-convertible debentures (NCDs).

HDIL’s share price opened at R60.25 on BSE on Wednesday and fell to an all-time low of R47.90, before closing 19.90% to a new low of R48.70. The company’s stock has fallen to the current levels from a 52-week high of R123.95 on January 16.

CARE downgraded two tranches of HDIL’s NCDs of a total of R1,895.37 crore to ‘D’ grade from BBB+, and another R200 crore of short-term NCDs from A3+ to ‘D’.

Instruments with ‘D’ grading are in default or are expected to be in default soon.

CARE said, “The revision in the ratings of HDIL reflects the ongoing delays in servicing its Non-Convertible Debentures obligations”.

HDIL, in a statement, said it has “not accepted” the said rating and reiterated that its financials and operational performance remains strong.

“The company has submitted to CARE to review/restore the rating,” it said.

However, speaking to FE, CARE officials said that it was not a matter of HDIL not accepting the rating as there have been defaults on interest payment, which has led to the downgrading of NCDs.

“Delayed or missed payment is a default,” said a senior official. “Once the bonds are issued by the company, as rating agencies we keep monitoring them and there is a continuous surveillance that happens. In this case, there have been delays on interest payments, which amounts to default as per the Reserve Bank of India definition of defaults,” he said.

A senior official from HDIL said, there was a delay in payment of R2-crore of interest amount, which has been cleared now.

“Our accounts were frozen due to certain service tax-related issue, due to which we could not make the interest payment for February, but we have cleared it in March,” the person said. He also said that the company is looking to repay R180 crore of debt to banks by March 31. The re-payment will be done from the amount the company has realised through a sale of land to Adani Group last year. “We have booked about R400 crore from the land sale to Adani Group in the third quarter, of which around R180 crore will go towards debt repayment by March 31.” HDIL had sold a two-acre land in Andheri to Adani Enterprises for R900 crore last year.

In January too, HDIL’s share price tumbled almost 40% in three days between January 21 and January 24 on investors’ worries over HDIL’s financial health, given its high debt and 98% of promoter shareholding pledged. HDIL’s consolidated net debt as on December 31, 2012, stood at R3,920.14.

Sarang Wadhawan, HDIL’s promoter, sold 50 lakh shares worth R57 crore in January, which had led to a sharp fall in the company’s stock price then. Wadhawan brought down his stake to 0.99% from 2.19%. The company had clarified that the money was required to meet some payment obligations towards a 15-acre Digvijay Mill land in the south Mumbai area of Bycullah, which was purchased in 2010.