The sustainable debt is considered at Rs 1,271.30 crore or 52.75% whereas balance debt of Rs 1,138.74 crore or 47.25% is considered unsustainable
Supreme Infrastructure has received the nod to restructure its Rs 2,410 crore debt raised from a State Bank of India-led consortium under the Scheme for Sustainable Structuring of Stressed Assets (S4A).
On Thursday, the company officials announced that Reserve Bank of India's (RBI)'s oversight committee has approved implementation of S4A resolution plan.
As per an exchange filing, the entire debt has been split into two parts - sustainable and unsustainable.
"Out of the total debt of approximately Rs 2,410.04 crore considered under the S4A scheme, the sustainable debt (Part A) is considered at Rs 1,271.30 crore (52.75%) whereas balance debt of Rs 1,138.74 crore (47.25%) is considered as unsustainable debt (Part B)," read the filing.
With the approval for S4A, Supreme Infrastructure's share price shot by 7.58% on Thursday to close at Rs 95.05 per scrip.
The resolution plan includes around 46,13,478 equity shares or 17.95% of the existing paid up equity share capital from the present holding of the promoters, which will be transferred to lenders by the invocation of existing pledged shares or sale of promoters shares. As per the resolution, company promoters will not change.
"The balance portion of Part B debt of Rs 1,134.13 crore would be converted into optionally convertible debentures for the tenor of 15 years," read the filing note.
In the case of a default in payment by the company, the lenders will be able to convert the optionally convertible debentures into equity shares.
The resolution by the oversight committee also approved repayment of optionally convertible debentures to be made in seven equal instalments, commencing 2025-26.
The infrastructure company has been facing challenges in implementing existing projects and also in bagging a new construction project in Mumbai.
Last month, the consortium of banks led by Union Bank of India had put up one of Supreme's road projects near Mumbai – Manor-Wada-Bhiwandi project for strategic debt restructuring. The lenders want to have new investors with management control to revive the project.
For another build-operate-transfer project that was facing hurdles - 84-kilometre long Panvel-Indapur highway widening - National Highways Authority of India (NHAI) had to intervene; it spent Rs 559 crore from its funds to execute the project in lieu of a part of the toll revenue generated.
After Supreme had spent around Rs 450 crore for the Panvel-Indapur project, State Bank of India-led bankers had suspended subsequent funding as they wanted to avoid further increase in company's liabilities including interest.
...& ANALYSIS
- Sustainable debt is considered at Rs 1,271.30 crore (52.75%)
- With the approval for S4A, the firm’s share price shot by 7.58%
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With the approval for S4A, Supreme Infrastructure's share price shot by 7.58% on Thursday to close at Rs 95.05 per scrip.
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