“The Group has further enhanced its estimates of aggregate debt recovery to ₹61,000 crore—an increase of ₹5,000 crore over its earlier estimate of ₹56,000 crore. The increased estimate represents the resolution of nearly 62% of overall fund-based and non-fund-based Group debt of approx. ₹99,000 crore, as of October 2018," the company said in a statement.
The aggregate debt of ₹43,000 crore addressed to date represents nearly 71% of the overall revised targeted recovery value of ₹61,000 crore and 44% of the overall debt of over ₹99,000 crore (as of October 2018).
"It may be kept in mind that the recovery target is higher than the average recovery observed under IBC since its inception," the company added.
Of the 347 entities that IL&FS had under IL&FS Group (as of October 2018), 186 entities stand resolved to date, while the remaining 161 entities are under various stages of resolution.
IL&FS which began operations as a road construction financing company, expanded its ambit to around 347 subsidiaries, amassing a debt pile of about ₹91,000 crore in the process. In August 2018 when the company was unable to service bonds that were due to investors, it collapsed.
In October 2018, the government set up a panel under banker Uday Kotak to set the resolution process in place in the conglomerate.
"The new board has been able to maximize the recoveries for all classes of creditors, through following a three-pronged strategy of resolution, restructuring, and recovery, while keeping the tenets of corporate governance and corporate finance in mind," the company said.
The upgrade in potentially addressable debt by ₹5,000 crore (to ₹61,000 crore) has been largely on account of improved valuations, better operating performance, and enhanced recoveries from non-group exposures.
The aggregate addressed debt of ₹43,000 crore comprises ₹26,800 crore basis completed entity monetization initiatives and accrued cash balance, ₹14,350 crore of additional net recovery expected from resolution and restructuring applications filed with and awaiting approval of the NCLT (Mumbai) and NCLAT, and ₹1,926 crore from Supreme Court verdict passed in favour Rapid Metro Gurgaon.
The company has since this January, complete the sale of Chongqing Yuhe Expressway, sale of environment business; receipt of settlement claims from NHAI for three road projects (Kiratpur Ner Chowk, Fagne Songadh and Chenani Nashri Tunnel); receipt of proceeds under IBC resolution of Dighi Port; operating income received in operating road concessions and through sale of power at ITPCL.
In the next few quarters, it estimates to address approx. ₹8,000 crore of additional debt by September 2021 which would include: monetization of stake in ONGC Tripura, Warora Chandrapur, and Karyavattom Stadium; phase two of InvIT including five road special special vehicles; and receipt of expected settlement claims from Road authorities for Khed Sinnar Expressway and Srinagar Sonmarg Tunnel.
Thus, the overall debt addressed is expected to cross ₹51,000 crore by September 2021. Further, recovery of approximately ₹10,000 crore is likely to spill over beyond September 2021 on account of various reasons, including procedural complexities, it said.
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