Jayaswal Neco Industries is hoping for an intervention by the high court to save it from being dragged through the insolvency proceedings.
Jayaswal Neco Industries is hoping for an intervention by the high court to save it from being dragged through the insolvency proceedings. The company filed a writ petition with the Bombay High Court seeking an order to implement its approved debt restructuring plan, even as it acknowledged that it has received a copy of the application filed by the State Bank of India before the National Company Law Tribunal (NCLT), against the company, under the Insolvency and Bankruptcy Code, 2016. Both these developments were intimated to the stock exchanges through separate notifications on Friday. Jayaswal Neco is one of the 28 companies in the Reserve Bank of India’s (RBI) second list of corporate defaulters, and was given time till December 13, 2017 to finalise a debt resolution plan with its lenders.
According to the central bank’s directive, if these 28 companies fail to finalise a resolution plan in the stipulated period, they would be referred to the National Company Law Tribunal (NCLT) for insolvency proceedings. “Although we had submitted a plan within the specified time period and the bankers had agreed to it, we have not been able to implement the plan. Therefore, we have approached the High Court,” said Randhir Javery, general manager (Corporate) at Jayaswal Neco.
The company is also believed to have paid some money towards the resolution plan to lenders, sources said. “The company has filed a writ petition with hon’ble Bombay High Court for the issuance of an appropriate writ, order or direction for implementation of the approved debt restructuring scheme of the company,” Jayaswal Neco said in its statement to the stock exchanges.
Jayaswal Neco is a manufacturer of iron and steel and ferrous and non-ferrous casting products. The total debt of the company stood at Rs 3,853 crore as of March 31, 2017, data from Bloomberg showed. It reported a net loss of Rs 459 crore on revenues of Rs 2,516 crore in FY2017, according to Bloomberg data. Jayaswal Neco’s bankers include the State Bank of India, Union Bank of India, Punjab National Bank, IDBI Bank, Andhra Bank and UCO Bank among others. The company has an iron and steel plant in Raipur and casting plants in Nagpur, Bhilai and Anjora, data from its 2015-16 annual report showed. Shares of Jayaswal Neco closed at Rs 12.47 on Friday on the Bombay Stock Exchange, up 2.55% from the previous close.