Tag: Piramal

Piramal Enterprises confident of recovery in downstream investment in AIFs

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Piramal Enterprises Ltd (PEL) on Thursday, December 21, said it is confident of recovery of the underlying downstream investments in the impacted Alternative Investment Funds (AIFs) following RBI guidelines earlier this week. As of November 30, 2023, the value of investments by PEL and Piramal Capital & Housing Finance Limited in AIF units was ₹3,817 crore.

In a regulatory filing, Piramal Enterprises said ₹653 crore of this pertains to funds that have no exposure to any debtor companies. Of the remaining ₹3,164 crore, ₹1,737 crore worth of downstream investments have been made by the AIF into three entities that are (or were in the last 12 months) debtor companies, it said.

“Taking a conservative view of the regulatory intent, PEL intends to adjust the entire ₹3,164 crore in our financial statements through capital funds or provisions. We are engaging with relevant stakeholders to finalize the details,” it said. According to a brokerage firm Emkay report, PEL will be providing for this entire ₹3,160 crore; as a result, FY24 reported P&L should see a material impact and estimated losses would be ₹2,200 crore in FY’24.

Earlier this week, the Reserve Bank barred banks and NBFCs from investing in any scheme of Alternative Investment Funds (AIFs) having investment in companies that have taken loans from the lenders concerned in the past 12 months to curb the evergreening of loans. Banks and NBFCs, which are Regulated Entities (RE) under the Reserve Bank of India (RBI), make investments in units of AIFs as part of their regular investment operations.

Further, it has directed lenders that such investments would be required to be liquidated within 30 days. IIFL Finance in a separate filing said there is an Investment of ₹21.37 crore in IIFL Fintech fund where the company has outstanding debt exposure of ₹3.28 crore in one of the downstream investments of the fund.

The material subsidiary of the company IIFL Home Finance Limited holds investments of ₹161.07 crore under ’Priority Distribution Model’ which if not liquidated would require a 100% deduction from its capital, it said. However, the subsidiary is adequately capitalised having a capital adequacy ratio of 47.55% as of September 30, 2023, and the impact of this deduction would reduce this to 46.39% if reinstated as of September 30, 2023, reflecting a marginal impact of 1.16%.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Piramal Realty, Jio-bp join hands for installing EV charging stations in Mumbai

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Piramal Realty, the real estate arm of Priamal Group, on Thursday said it has joined hands with Jio-bp, a fuel and mobility joint venture between RIL and bp, for installing EV charging stations across all Piramal’s residential projects in the Mumbai Metropolitan Region(MMR).

According to a joint statement released by the companies, customers and visitors to Piramal’s residential projects will be able to charge their electric vehicles seamlessly at Jio-bp pulse EV charging stations at sites with the Jio-bp pulse mobile app.

Additionally, Jio-bp has installed the first set of EV charging points at Piramal Vaikunth in Thane, the joint statement revealed.

Also Read: Is battery swapping a reality? Hero-partner Gogoro to announce India plans on Nov 3

Last month, Uttarakhand transport department announced its plans to set up electric vehicle (EV) charging stations every 26 km on the Char Dham yatra routes to ensure emission-free travel to protect the environment.

This year in January, electric vehicle charging services provider, Statiq, bagged a contract from Rajasthan Electronics & Instruments Ltd (REIL) to supply 253 fast EV chargers for four key highway projects connecting Agra-Lucknow, Meerut-Gangotri, Chennai-Bellary, and Mangaldai-Wakro.

Also Read: All you need to know about charging your EV at home

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

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Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Reliance Cap redressal — IBC, launched with a lot of fanfare, again proves itself a riddle

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Reliance Capital (RCAP) was the third major non-banking financial firm to be cherrypicked by the Reserve Bank of India (RBI) in November 2021 under IBC after Srei Group and Dewan Housing Finance Corp. Ltd (DHFL) for quick resolution of its festering NPA problem. But it has sadly been riddled with repeated extension of deadlines and other niggling issues.

On December 21, 2022, Torrent Investments made the winning bid of Rs 8640 crore in the first round of auctions for RCAP’s assets as against its monumental debts of about Rs 25,000 crore thus spelling yet again massive haircuts for creditors. Dismal as the winning bid was Hinduja group threw spanner in the works a day after the auction ended, by making an improved offer of Rs 8,950 crore. Following an appeal by Torrent, the NCLY restrained the administrator of RCAP Nageswara Rao Y from presenting the non-compliant bid to the committee of lenders. 

Three days later, however, the lenders in a meeting decided that the winning bid in the first round of auctions was suboptimal and decided to hold another round of auctions. That flies in the face of one of the key principles of IBC—ensuring the resolutions take place in a time-bound manner. It remains to be seen what happens on 31st January 2023 when the NCLT meets again to resume the case.

Also Read: Reliance Capital IBC case | Committee of Creditors votes in favour of 2nd round of e-Auction 

The Jaypee Infratech insolvency, for instance, took five years to complete. Data from the Insolvency and Bankruptcy Board of India say that the 553 cases that were closed under IBC on an average took 561 days to close and the 1800 odd cases that went into liquidation took 437 days to attain closure. Delays are explained away as due to woeful lack of infrastructure but the government needs to do more than give excuses.

Come to think of it, if creditors resignedly settle for liquidation after having plumped for the IBC redressal, they must be ruing their initial decision because each passing day pulls down the value of the assets realisable by the liquidator thus making their lot a lot worse. The situation is not improving. There were 1947 insolvency cases before the tribunals as on 30 Sep 2022; eight out of every 10 are pending for at least 270 days as against the 180 days fixed for resolution though NCLT is empowered to give extensions so ultimately closure is made at least within 330 days. 

IBC is obsessed with ousting the incumbent promoters as if that alone will make them behave. In India, promoters are thick-skinned.  They don’t lose sleep over being dethroned. DHFL promoters who presided over the ruination of their company ceded control to Piramal group. By being fixated with the highest bid which often entails as much as 90 percent haircut for the creditors, IBC leaves the creditors holding the can. Truth be told such huge sacrifices are not mere haircuts but tonsure. 

One wishes the government had ordered an ILFS style rescue plan for RCAP given the fact that like ILFS, RCAP too has finger in every financial pie ranging from NBFC to insurance to asset reconstruction. No single buyer would obviously evince serious interest unless he is getting the diversified interests on a platter for a song. In other words, the government is guilty of making RCAP creditors victims of conglomerate discount—-when a company has dabbled with too many businesses without focus.

Indeed, ILFS model seems to have produced fairly good results with Rs 55000 crore worth of debts out of Rs 90,000 crore pulled out of the mire and rehabilitated in the hands of worthy successors  Had Uday Kotak the head of the ILFS rescue team, followed the IBC model of a single buyer, he might have reported dismal results. He wisely went business by business of ILFS instead of lumping them together in an incongruous heap. Government must take a leaf out of him and look beyond IBC to get the maximum from defaulters.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

SC stays NCLAT order sending Piramal’s winning bid for DHFL to lenders for reconsidering valuation

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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The Supreme Court on Monday stayed the NCLAT order in which it had sent back the Piramal Group’s winning bid for DHFL to the debt-laden finance company’s lenders for reconsidering the valuation.

The National Company Law Appellate Tribunal (NCLAT), in January this year, while delivering a judgement on the 63 Moons Technologies petition had directed the lenders of Dewan Housing Finance Corporation Limited (DHFL) to reconsider their decision regarding the valuation of the financial firm’s avoidable transactions, while approving the insolvency resolution plan submitted by Piramal Capital & Housing Finance Ltd.

A bench comprising Chief Justice NV Ramana and Justices Krishna Murari and Hima Kohli agreed to the appeal of the Piramal group challenging the NCLAT’s verdict that had asked the lenders to reconsider the sale terms allowing Piramal to appropriate possible recoveries from past transactions worth Rs 45,000 crore. The top court has now posted the matter for further hearing on May 5.

Also Read: Piramal Enterprises to raise up to Rs 500 cr via NCDs

Solicitor General Tushar Mehta, appearing for the committee of creditors (CoC), said that most of these transactions by former management DHFL were irregular or fraudulent, and the banks did not expect to get any money out of it.

Under the insolvency resolution proceedings for the crisis-hit DHFL, Piramal Capital had emerged as the winning bidder and the Committee of Creditors (CoC) had ascribed a value of just Re 1 for Rs 45,000 crore-worth recoverable assets of DHFL. These were assets apparently diverted fraudulently by the erstwhile promoters of DHFL.

NCLAT had sent the approved resolution plan back to the CoC in order to reconsider the aspect of the valuation of avoidable transactions that pertain to the recoverable assets.

Under the Insolvency and Bankruptcy Code (IBC), avoidance transactions are those which are identified as undervalued, fraudulent, or extortionate by the former promoters.

The resolution plan, which was voted in favour by the CoC, was approved by the Mumbai bench of the National Company Law Tribunal (NCLT) on June 7, 2021.

As per the plan, a notional value of Re 1 was given for all recoveries under Section 66 of the IBC whereby applications for recovery of assets worth over Rs 45,000 crore were filed by the DHFL administrator. Section 66, pertains to transactions in connection with fraudulent trading.

According to the NCLAT, avoidance transactions were not factored in the resolution plan, and hence the matter needs to be reconsidered. In September 2021, Piramal Capital & Housing Finance Ltd (PCHFL) acquired DHFL for a total consideration of Rs 34,250 crore.

PCHFL has retained over 3,000 employees of the DHFL Group and is also adding over 2,000 new jobs in the merged entity. New origination of Affordable Housing loans has been restarted at all 301 branches across the country, the company statement had said.

Also Read: Delhi HC quashes MEA’s directive over judges’ foreign travel; terms it ‘uncalled for’

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

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Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Adani Group, Piramal Healthcare, Akums in race to buy central government’s HLL Lifecare

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Top Indian corporations, Adani Group and Piramal Healthcare, are in the race to buy the public sector pharmaceutical firm, HLL Lifecare limited (HLL), News18.com has learnt.

The country’s largest contract research firm, Akums Drugs and Pharmaceuticals, is also one of the companies that have shown interest to buy HLL – the company known for its famous condom brand, Moods, beside other contraceptive brands and drugs.

The Department of Investment and Public Asset Management (DIPAM) on December 14 had invited preliminary bids to sell the government’s 100% stake in the central public sector enterprise (CPSE).

“Multiple expressions of interest have been received for privatisation of HLL Lifecare Limited (HLL). The transaction moves ahead to the next stage,” DIPAM secretary Tuhin Kanta Pandey tweeted on March 14.

“Around seven companies have submitted expressions of interest and all of them are popular and competitive enough,” a government official privy to the development told News18.com.

“Top names include Adani group, Piramal healthcare, Akums India, whereas the other three companies are based out of southern India. These companies have submitted their expression of interest to PricewaterhouseCoopers (PwC),” the source said.

Also read: JPMorgan initiates coverage on Adani Wilmar with ‘neutral’ rating; target price 60% above issue price

PwC is the transaction advisor appointed by the central government to advise and manage the strategic disinvestment of HLL.

News18.com reached out to Adani Group, Piramal Group and Akums India for an official confirmation on their participation in buying HLL.

Piramal Group and Akums India did not respond to the mail and messages till the time of publishing the report, whereas Adani Group spokesperson said, “As a part of the company’s business growth strategy, we continue to evaluate various viable options. The company, however, doesn’t comment on speculations.”

While Piramal Healthcare – seller of popular medicine brands such as iPill – and Akums India has significant presence in the India’s pharmaceutical market, Adani Group’s participation to acquire HLL may hint at the company’s plan of venturing into the healthcare industry. Recently, Tata Group has also made an entry into the segment via acquisition of online pharmacy chain, 1MG.

On March 1, 1966, HLL was incorporated as Hindustan Latex Limited under the Union Ministry of Health and Family Welfare. It was renamed HLL Lifecare Limited in 2009.

Also read: ‘We like buying brands… especially in the OTC space,’ Nandini Piramal

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

63 Moons moves NCLAT, challenges Piramal’s DHFL acquisition

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Mumbai-based financial services firm 63 Moons Technologies on Tuesday moved National Company Law Appellate Tribunal (NCLAT), challenging the National Company Law Tribunal’s (NCLT) nod for Piramal’s resolution plan.

It is seeking interim protection from NCLAT, saying that the plan execution is subject to NCLAT nod. The company holds over Rs 200 crore worth of NCDs in the troubled mortgage lender.

The Mumbai-based company said the current resolution plan is “contrary to law” and “against the interest of all DHFL’s creditors, including NCD (non-convertible debentures) holders.”

While agreeing to hear the plea, NCLAT issued notices to the committee of creditors (CoC), DHFL, and Piramal Group.

Earlier in June, NCLT had cleared Piramal Group’s resolution plan for Dewan Housing Finance Ltd with some conditions. Piramal Group had submitted a Rs 34,250 crore bid to acquire DHFL.

The acquisition has been approved by both the Reserve Bank of India (RBI) and the Competition Commission of India (CCI). In January 2021, DHFL’s CoC had also voted in favour of selling the troubled company to the Piramal Group.

As per Piramal Group’s plan, the money received from the promoter group will go to the DHFL, while its creditors will get nothing. This does not sit well with 63 Moons. FD- and NCD-holders, like 63 Moons, are the biggest lenders to DHFL and they represent public’s money.

DHFL owes Rs 45,000 crore to FD- and NCD-holders, while it owes Rs 35,000 crores to commercial banks, who dominate the CoC and have the power to influence the decision.

Even after acquisition by Piramal Group, DHFL’s losses stand well above Rs 50,000 crore. Out of this, those who invested up to Rs 2 lakhs stand to get their principal amount (not interest), while FD-holders stand to lose 75 percent and NCDs lose 60 percent of their investment.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

CNBC-TV18 Exclusive: Piramal Group wins bid for DHFL with almost 94% votes, say sources

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Billionaire Ajay Piramal led Piramal Capital & Housing Finance Limited (PCHFL) has emerged as the winning bidder for Dewan Housing Finance Limited (DHFL), after almost 94 percent of the creditors voted in its favour, multiple people aware of the development told CNBC-TV18.

Oaktree Capital’s resolution plan secured only 45 percent of votes from the creditors committee, people familiar with the matter said.

To be declared the winning bidder, the resolution plan has to secure the highest share of votes from the creditors committee, subject to a minimum of 66 percent votes. The CoC voted on plans submitted by all 4 suitors.

The voting concluded after six rounds of an intense bidding war between the suitors. While the creditors committee’s vote gets Piramal Group one step closer to the takeover of DHFL, the deal may be far from done. Several people closely involved in the matter opined that because of the apparent strife between the suitors throughout the process, no matter which proposal the CoC selects, the other bidders are expected challenge the takeover in court.

The CoC had put all six plans to vote, including one each from Piramal Group, Oaktree Capital and Adani Group under Option I for the entire DHFL book, another bid from Piramal Group for the retail portfolio, Adani for the wholesale & slum rehabilitation portfolios, and from Hong Kong-based SC Lowy for the wholesale portfolio.

Oaktree Capital and Piramal Group were seen as front-runners to acquire DHFL with the highest offers of the four suitors that came forward, CNBC-TV18 had reported.

Piramal Group’s plan promises recovery of almost 43 percent to the creditors of DHFL.

As per the resolution plan put to vote, which CNBC-TV18 has reviewed a copy of, Piramal Group offered Rs 37,250 crores in total to acquire DHFL. This includes Rs 12,700 crores as upfront cash which factors in Rs 150 crores to Fixed Deposit (FD) holders, another Rs 3,000 crores upfront from the interest earned on the cash on DHFL’s books, Rs 1,000 crores of interest income after NCLT approval and another Rs 1,000 cr by way of value ascribed to the insurance business. Piramal Group’s offer also includes Rs 19,550 crores in the form of debt instruments spread over 10 years.

Against this, Oaktree offered Rs 38,400 crores, including a Rs 1700 crore addition in the bid. The additional Rs 1,700 crore offer was challenged by rival Piramal, who claimed Oaktree made the revision on December 24, after the bid deadline had closed. This included Rs 17,100 crores in the form of upfront cash, insurance business value, interest earned on cash, etc. Oaktree’s offer also included Rs 300 cr for FD holders, and Rs 21,000 crores in the form of debt instruments spread over 7 years.

DHFL is the first financial services firm to have been sent to NCLT under the Insolvency and Bankruptcy Code (IBC), and will set the precedent for other stressed financial sector entities. The entire resolution process has been mired in controversy, with unsolicited offers, bickering between suitors, conflict of interest issues with legal advisors to the firm, and the promoter facing allegations of fraud.

The company is facing claims of over Rs 87,000 crores, with almost Rs 38,000 crores in the form of bank loans alone. State Bank of India, Union Bank of India, Bank of Baroda, Indian Bank and several others have exposure to the troubled mortgage lender.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Adani, Piramal, Oaktree Capital & SC Lowy submit bids for DHFL

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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As many as four suitors have placed firm bids to acquire Dewan Housing Finance Limited (DHFL) ahead of the deadline expiry later today, four people in the know confirmed to CNBC-TV18.

Hong Kong-based SC Lowy was the first one to submit a bid today and has made an offer to acquire DHFL’s wholesale assets, as per people in the know. Gautam Adani-led Adani Properties has also submitted a bid to acquire the wholesale portfolio, CNBC-TV18 has learnt.

Piramal Enterprises submitted a bid to acquire DHFL’s retail assets, said another person quoted earlier. He added that US-based distressed asset fund Oaktree Capital has submitted a bid to acquire the entire book.

Also read: Few suitors remain in the fray as DHFL bid submission deadline ends today

CNBC-TV18 had earlier reported that these four players were the only serious suitors that remained in the fray of the 22 players that were shortlisted by DHFL’s lenders to submit bids.

Adani Properties has long been interested in acquiring DHFL and was in talks with its lenders even before the mortgage lender was sent to the bankruptcy court.

Also read: DHFL seeks loan dues of Rs 112 crore from Pune-based realtor, guarantors

Hong Kong-based SC Lowy is a privately-owned global banking group that specialises in distressed and high-yield fixed income markets and has been active in the secondary market for stressed assets in India. In response to CNBC-TV18’s query on its bid for DHFL, SC Lowy’s founder and CEO Michel Lowy in an emailed statement confirmed, “SC Lowy views the DHFL investment opportunity as a key milestone to grow its infrastructure in India. India is our number one priority as we expand our Asian footprint.”

Also read: Union Bank may file personal bankruptcy case against Wadhawans of DHFL

DHFL is the first financial services company where lenders are attempting a resolution via the Insolvency and Bankruptcy Code. It was admitted into NCLT in December last year after RBI superseded its board owing to governance concerns. DHFL is facing claims of over Rs 94,900 crores from financial creditors in NCLT.

Dewan Housing Finance Corporation (DHFL) reported a pre-tax profit of Rs 92.81 crore in the quarter ended June 2020, against a loss of Rs 198.85 crore in the year-ago period. Its net for the period stood at Rs 70 crores and total income at Rs 2,328.86 crore. Almost 28 per cent of its book is under moratorium as of June 30.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow