Lanco Infra hopes to be back on its feet by Feb on bank panel’s resolution plan

V RISHI KUMAR Hyderabad | Updated on January 09, 2018 Published on December 22, 2017

Shareholders raise concerns at AGM

Lanco Infratech Ltd is likely to see a bankers-led ‘resolution plan’ being worked by February 2018, which may see the debt-ridden infrastructure company finding its feet again.

With most of the projects struck without any progress, and the company now under the management of Insolvency Professional Savan Godiawala appointed by the National Company Law Tribunal, the only way out of the current crisis is the likely resolution by a committee of lenders, who have been working under the guidance of the Insolvency Professional.

Answering queries of some of the agitated shareholders, Godiwala said: “The company was handed over for management by NCLT on August 7. We have about six months to find a resolution of the problems faced by the company. There has been positive response. We expect to see some clear direction by next month.”

“There is a facility to resolve issues within 180 days. But this has option to be extended up to 270 days with the consent of NCLT and lenders, provided there is potential for resolution. There has been positive response through expression of interest,” Godiawala said.

This could mean divestment of some of the matured assets, including roadways, picking up stake in some of the power projects, or even outright purchase. However, this will have to be in concurrence with the lenders.

Earlier, chairing the 24th annual general meting held here, Uddesh Kumar Kohli, said: “The performance of the company has been affected due to inadequate fuel supply for operation of installed capacity, regulatory approvals, lack of power purchase agreement, delay in sanction and disbursement of loan by lenders and liquidity problems.”

On a consolidated basis, the company posted gross revenue of ₹8,335 crore and loss of ₹2,049 crore during 2016-17.

Mentioning about IDBI Bank initiating proceedings under the Insolvency and Bankruptcy Code, he said NCLT suspended the powers of the board of directors which are currently being exercised by the Resolution Professional. Hopefully with a Resolution Plan, majority of the order book can be executed in the coming years, Kohli said.

On Griffin Coal, he said during 2016-17, it produced 2.5 mt of coal and garnered revenue of ₹522 crore and loss of ₹138 crore.

Post the Chairman's address, shareholders raised a number of questions wanting to know the progress post the NCLT and whether the company would get back to its glory days.

One shareholder from Chennai, Abhishek suggested that the company closed some of the subsidiaries and de-listed from the NSE to save on costs.

Another shareholder Shankarlal Nadda wanted the demerger of EPC and power business so that the company would be able to focus on each of these.

Kantailal Jain expressed hope that Lanco would turn corner as it celebrates its 25th AGM next year with a proper solution from Insolvency Professional. Bharat Shah lamented the steep drop of share value in the market.

Responding to shareholders concerns, the Lanco management hoped that various issues plaguing the infra sector will get resolved along with its own issues so that the company gets back to normal functioning.

Published on December 22, 2017

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