L&T Finance sells Rs 47.62 bn of distressed assets
ECONOMY & POLICY

L&T Finance sells Rs 47.62 bn of distressed assets

L&T Finance is set to offload its distressed-asset loan book worth Rs 47.62 billion to three asset reconstruction companies (ARCs) by the end of the current quarter, according to sources familiar with the matter. Phoenix ARC, backed by Kotak Mahindra Bank, is expected to acquire the majority of the 15 bid-out accounts, followed by CFM ARC and Prudent ARC.

L&T Finance, a subsidiary of L&T Finance Holding, had invited offers from ARCs for a portfolio valued at Rs 52.93 billion, comprising 16 accounts. The offering was structured with a combination of security receipts (SR) and cash payments, with 15 per cent paid upfront in cash and the remaining 85 per cent as security receipts. A reserve price of Rs20.80 billion was set.

However, none of the ARCs expressed interest in acquiring the exposure to Delhi-NCR realtor Supertech, one of the 16 accounts with outstanding loans of Rs 5.31 billion. Consequently, L&T Finance opted to sell 15 accounts with outstanding loans amounting to Rs 47.62 billion.

It is expected that the deal will be finalised before the end of the current month. L&T Finance's stock has seen a 40 per cent increase in 2023, reflecting the company's efforts to clean up its balance sheet by divesting troubled assets. Among the problematic exposures in L&T's portfolio are Avantha Holdings (Rs11.16 billion), Bhoruka Power (Rs18.76 billion), IREO (Rs 4.33 billion), and Supertech (Rs 5.31 billion).

The remaining accounts in the portfolio include Bhoruka Power Investments, Coast Town Planners, CSA Properties, Hanjer Biotech Mira, JCSA Enterprises, Mabsoot Buildhomes India, ND Telecom Services, Perpendicular Construction, RPS Infrastructure, Sagar Power Dendela, Shapoorji Pallonji Development Managers, and Smartstone Property Developers.

L&T Finance has been consistently offloading distressed asset portfolios to ARCs. In June of the current year, the finance company sold an Rs18 billion portfolio to Phoenix ARC, consisting of six real estate accounts, and in March, it divested an Rs 8.80 billion distressed portfolio containing five real estate loans to the Pune-based Xrbia group.

L&T Finance is set to offload its distressed-asset loan book worth Rs 47.62 billion to three asset reconstruction companies (ARCs) by the end of the current quarter, according to sources familiar with the matter. Phoenix ARC, backed by Kotak Mahindra Bank, is expected to acquire the majority of the 15 bid-out accounts, followed by CFM ARC and Prudent ARC.L&T Finance, a subsidiary of L&T Finance Holding, had invited offers from ARCs for a portfolio valued at Rs 52.93 billion, comprising 16 accounts. The offering was structured with a combination of security receipts (SR) and cash payments, with 15 per cent paid upfront in cash and the remaining 85 per cent as security receipts. A reserve price of Rs20.80 billion was set.However, none of the ARCs expressed interest in acquiring the exposure to Delhi-NCR realtor Supertech, one of the 16 accounts with outstanding loans of Rs 5.31 billion. Consequently, L&T Finance opted to sell 15 accounts with outstanding loans amounting to Rs 47.62 billion.It is expected that the deal will be finalised before the end of the current month. L&T Finance's stock has seen a 40 per cent increase in 2023, reflecting the company's efforts to clean up its balance sheet by divesting troubled assets. Among the problematic exposures in L&T's portfolio are Avantha Holdings (Rs11.16 billion), Bhoruka Power (Rs18.76 billion), IREO (Rs 4.33 billion), and Supertech (Rs 5.31 billion).The remaining accounts in the portfolio include Bhoruka Power Investments, Coast Town Planners, CSA Properties, Hanjer Biotech Mira, JCSA Enterprises, Mabsoot Buildhomes India, ND Telecom Services, Perpendicular Construction, RPS Infrastructure, Sagar Power Dendela, Shapoorji Pallonji Development Managers, and Smartstone Property Developers.L&T Finance has been consistently offloading distressed asset portfolios to ARCs. In June of the current year, the finance company sold an Rs18 billion portfolio to Phoenix ARC, consisting of six real estate accounts, and in March, it divested an Rs 8.80 billion distressed portfolio containing five real estate loans to the Pune-based Xrbia group.

Next Story
Infrastructure Urban

MoHUA Plans New Role for Smart City SPVs

In a significant policy move, the Ministry of Housing and Urban Affairs (MoHUA) has issued an advisory encouraging the continued use and repurposing of Special Purpose Vehicles (SPVs) formed under the Smart Cities Mission (SCM). This marks a step toward sustaining urban transformation by leveraging institutional capabilities and infrastructure developed over the past decade.Initiated in 2015, the Smart Cities Mission introduced a new era of urban planning in India, with each of the 100 selected cities forming SPVs under the Companies Act, 2013. These entities, jointly owned by state government..

Next Story
Infrastructure Urban

ADB Approves $110 Million Loan to Boost Skills in Gujarat

The Asian Development Bank (ADB) has approved a USD 109.97 million (Rs 9.27 billion) results-based loan to support Gujarat’s efforts to become a global industrial hub by developing a future-ready, skilled workforce.The funding will back the Gujarat skills development programme, led by the Department of Labour, Skill Development and Employment in collaboration with Kaushalya: The Skill University (KSU). The initiative aims to equip the workforce with advanced, industry-aligned skills to meet rising employment demand in high-growth sectors.According to ADB, the programme seeks to strengthen in..

Next Story
Infrastructure Urban

SDAL Tests Rudrastra UAV and Bhargavastra Defence System

Solar Defence and Aerospace Limited (SDAL) has successfully completed a key flight test of its indigenous Hybrid VTOL UAV Rudrastra at the Pokharan Firing Range, aligning with Indian Army performance benchmarks for mission adaptability, high endurance, precision engagement, and vertical take-off and landing (VTOL) capability.The trial marks a notable achievement in India’s Aatmanirbhar Bharat initiative, underscoring advancements in home-grown military technology. The Rudrastra UAV demonstrated a mission radius exceeding 50 km with uninterrupted video relay, a total operational range of over..

Advertisement

Advertisement

Subscribe to Our Newsletter

Get daily newsletters around different themes from Construction world.

STAY CONNECTED

Advertisement

Advertisement

Advertisement

Advertisement

Talk to us?