(AP file)
(AP file)

Icra puts Coffee Day rating on watch with negative implications

  • The agency revised the rating from watch with developing implications after the company’s promoter V.G. Siddhartha went missing on 29 July
  • Fishermen found Siddhartha's body in the backwaters of the Nethravati river on Wednesday morning

Mumbai: Credit rating agency Icra on Wednesday put Coffee Day Enterprises Ltd (CDEL) on watch with negative implications, revising the rating from watch with developing implications after the company’s promoter V.G. Siddhartha went missing on 29 July.

“The aforesaid development may have a negative impact on the operations of CDEL, the extent of which cannot be ascertained as yet, given the nascent stage of developments," it said, adding, since the development may have a critical bearing on the group’s operations and credit profile, Icra will continue to monitor developments and will finalize the rating action once more clarity emerges on the same.

Meanwhile, on Wednesday morning, fishermen found his body in the backwaters of the Nethravati river at Hoige Bazaar. V.G.Siddhartha’s body was found at around 6:30 am by a couple of fishermen who were preparing their country boats for the day’s fishing trip. The body was then sent to Wenlock government hospital for postmortem.

The rating agency had, on 5 February, placed CDEL on rating watch with developing implications. On 26 January, 2019, Coffee Day Enterprises disclosed to stock exchanges that the income tax (I-T) department had provisionally attached 2.2 million shares of Mindtree Ltd held by the company (amounting to 1.35% of total paid-up capital of Mindtree) in addition to shares belonging to promoter Siddhartha.

Mint reported on 30 July that Siddhartha was in talks to urgently refinance a large portion of his outstanding debt taken in his personal capacity. The debt in question is around 2,000 crore and is over and above the consolidated borrowings of Cafe Coffee Day (CCD) group, which stood at 6,547.38 crore as of 31 March 2019.

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