Companies

Govt mulls measures to improve financial health of STC

PTI New Delhi | Updated on September 15, 2019 Published on September 15, 2019

As per the proposal, STC could be given a five-year time for repayment of ₹ 500 crore.

The government is considering measures to improve the financial health of State Trading Corporation (STC), a public sector unit under the commerce ministry, according to sources.

The measures, which are under consideration, include the provision of adequate time for STC to repay bank loans and sale of immovable assets.

“The steps have been discussed among commerce ministry, finance ministry and banks,” the sources said.

As per the proposal, STC could be given a five-year time for repayment of ₹ 500 crore.

Besides, banks would be asked to withdraw cases filed by them in the National Company Law Tribunal (NCLT) to recover their dues.

As per its FY19 annual report, the company is facing “severe liquidity crisis” as all the lenders have reported its account as NPA due to non-payment of interest.

Therefore, at present, the company has no banking limits, funded or non-funded, available with it.

The company has reported a net loss (after tax) of ₹ 881 crore during 2018-19 as compared to net profit (after tax) of about ₹ 38 crore in 2017-18.

The net loss reported in 2018-19 was mainly due to write-offs amounting to about ₹ 626 crore made in the books of accounts.

“Out of the total dues of about ₹ 1,906 crore (as on 31.12.2018) crystallized with the lender banks, an amount of ₹ 1,100 crore has already been paid by STC to the lender banks,” as per the report.

The balance amount is also proposed to be paid partly through the sale of its immovable properties and trade receivables to be realised by the company, it added.

The lender banks had filed petitions against STC in DRT/NCLT and the proceedings are on.

It is in the process of entering into a master restructuring agreement with the lender banks towards the settlement of their dues.

Published on September 15, 2019
This article is closed for comments.
Please Email the Editor