Kesoram concludes Rs 19 bn high-cost debt refinancing
ECONOMY & POLICY

Kesoram concludes Rs 19 bn high-cost debt refinancing

Kesoram had successfully completed the refinancing of its high-cost debt, which amounted to nearly Rs 19 billion, resulting in a benefit of approximately 800 basis points in interest rates. In March 2021, the company had borrowed the sum from a group of investors in Non-Convertible Debentures (NCDs) and Optionally Convertible Debentures (OCDs) at an interest rate close to 19 percent.

On the same day, the company declared the redemption of the entire outstanding NCD amount, totalling Rs 14.87 billion, before its maturity. Officials stated that OCDs had been redeemed earlier.

Kesoram's whole-time director & CEO P Radhakrishnan informed PTI, "The complete debt on our books has been refinanced. We secured refinancing of approximately Rs 15 billion from Tata Capital group and an additional Rs 3.5 billion from Hero Finance." He further added, "Our average cost of debt has now decreased to nearly 11.25 percent from over 19 percent previously. This will result in a reduction in our interest burden by more than Rs 300 million on a quarterly basis, positively impacting our bottom line."

In relation to the progress of the sale process of the cement business to UltraTech Cement, Radhakrishnan mentioned that although the effective date remains April 2024, he anticipates it will take some time to obtain all regulatory approvals.

UltraTech Cement is set to acquire Kesoram Industries' cement business in an all-share deal valued at approximately Rs 76 billion, including debt. In this arrangement, Kesoram shareholders will receive one share of UltraTech Cement for every 52 Kesoram shares of Rs 10 each.

Kesoram currently operates two integrated cement units in Sedam (Karnataka) and Basantnagar (Telangana) with a total installed capacity of 10.75 million metric tonnes per annum (MTPA), along with a 0.66 MTPA packing plant in Solapur, Maharashtra. In 2022-23, Kesoram's turnover from cement operations amounted to Rs 35.33 billion.

Kesoram had successfully completed the refinancing of its high-cost debt, which amounted to nearly Rs 19 billion, resulting in a benefit of approximately 800 basis points in interest rates. In March 2021, the company had borrowed the sum from a group of investors in Non-Convertible Debentures (NCDs) and Optionally Convertible Debentures (OCDs) at an interest rate close to 19 percent. On the same day, the company declared the redemption of the entire outstanding NCD amount, totalling Rs 14.87 billion, before its maturity. Officials stated that OCDs had been redeemed earlier. Kesoram's whole-time director & CEO P Radhakrishnan informed PTI, The complete debt on our books has been refinanced. We secured refinancing of approximately Rs 15 billion from Tata Capital group and an additional Rs 3.5 billion from Hero Finance. He further added, Our average cost of debt has now decreased to nearly 11.25 percent from over 19 percent previously. This will result in a reduction in our interest burden by more than Rs 300 million on a quarterly basis, positively impacting our bottom line. In relation to the progress of the sale process of the cement business to UltraTech Cement, Radhakrishnan mentioned that although the effective date remains April 2024, he anticipates it will take some time to obtain all regulatory approvals. UltraTech Cement is set to acquire Kesoram Industries' cement business in an all-share deal valued at approximately Rs 76 billion, including debt. In this arrangement, Kesoram shareholders will receive one share of UltraTech Cement for every 52 Kesoram shares of Rs 10 each. Kesoram currently operates two integrated cement units in Sedam (Karnataka) and Basantnagar (Telangana) with a total installed capacity of 10.75 million metric tonnes per annum (MTPA), along with a 0.66 MTPA packing plant in Solapur, Maharashtra. In 2022-23, Kesoram's turnover from cement operations amounted to Rs 35.33 billion.

Next Story
Infrastructure Urban

CMPDI installs bio-toilets to boost sanitation and hygiene

The Central Mine Planning and Design Institute (CMPDI), a subsidiary of Coal India Limited under the administrative control of the Ministry of Coal, has installed six modern bio-toilets equipped with bio-digesters and water tanks across various locations in Ranchi. The initiative was carried out under the ongoing Special Campaign 5.0, underscoring CMPDI’s commitment to cleanliness and sustainable sanitation. This effort forms part of a nationwide drive to enhance hygiene standards and improve efficiency in public offices. It aligns with the Government of India’s Swachh Bharat Mission and ..

Next Story
Infrastructure Urban

PM Modi unveils Rs 12.19 billion projects in Kevadia

Prime Minister Shri Narendra Modi inaugurated and laid the foundation stones for development projects worth Rs 12.19 billion in Kevadia on the eve of Sardar Vallabhbhai Patel’s 150th birth anniversary. The projects include the Birsa Munda Bhavan—an iconic centre dedicated to Bhagwan Birsa Munda—a residential complex for GSEC and SSNNL employees, the first phase of the hospitality district, and a Bonsai Garden. During the visit, the Prime Minister also flagged off a fleet of electric buses in Kevadia, an initiative aimed at providing comfortable and sustainable transport facilities for v..

Next Story
Infrastructure Transport

New metro link to connect Delhi airport’s T1 and T3

A new metro station will be part of the upcoming Golden Line to provide direct connectivity between Delhi airport’s Terminal 1 (T1) and Terminal 3 (T3), a senior official confirmed. Among the three terminals at the Indira Gandhi International Airport, Terminals 2 and 3 are located close to each other, while Terminal 1 lies a few kilometres away. In an interview with PTI, Delhi International Airport Ltd (DIAL) CEO Videh Kumar Jaipuriar said that the new integrated station is being planned to link Aerocity with Terminal 1. “The Golden Line was earlier planned to terminate at Aerocity. We h..

Advertisement

Subscribe to Our Newsletter

Get daily newsletters around different themes from Construction world.

STAY CONNECTED

Advertisement

Advertisement

Advertisement

Talk to us?