UPDATE: Videocon Industries has issued a statement refuting the assertion made in the agency story, which was originally titled “TV Maker Blames India’s Modi, Court and Brazil for Bad Debt Pile”. The company statement says: “The [agency] has misrepresented the order of the Member (judicial) at the National Company Law Tribunal, Mumbai Bench on June 06, 2018.” The statement reiterates the submission of the Videocon counsel, which reads: “However on account of demonetization in India the suppliers were unable to provide the raw material.”
Who’s at fault for Videocon Industries Ltd.’s 39 billion rupees ($579 million) debt pile? The Indian maker of consumer appliances is casting the blame on Prime Minister Narendra Modi, the nation’s top court and the Brazilian government.
A bankruptcy court admitted an insolvency petition filed by creditors, led by State Bank of India against Videocon, and ordered debt reorganizers to take over its management. That prompted the company to file an appeal to wrest back control, according to an exchange filing on Tuesday.
Modi’s clampdown on cash in November 2016 chocked supplies for making cathode ray tube televisions and forced it to shut the business, Videocon said in the filing. While its oil-and-gas business got entangled in red tape in Brazil, the telecommunications venture suffered losses after India’s Supreme Court canceled licenses.
The company’s shares, which have plunged a whopping 96 percent over the past five years, traded at 7.65 rupees at 12:26 p.m. in Mumbai.
Videocon’s energy business failed to get approvals from the Brazilian government to start its equal venture with Brazil Petroleum Ltd.. In India, the company lost a revenue source when the top court in February 2012 canceled 156 licenses of various telecom operators, according to the filing.