Tag: unitech

BSE resets circuit limit of CG Power, 5 others

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

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To curb excessive volatility, BSE on August 26 revised the circuit limit for the share movement of CG Power and Industrial Solutions and five other companies. In a notice, the exchange said it has set a circuit limit of 5 percent for CG Power.

The new limits, effective from August 27 will ensure stock prices do not go up or down beyond a level during a session.

CG Power has been witnessing volatility in its share prices after the firm on August 20 stated that an investigation instituted by its board had found major governance and financial lapses including some assets being provided as collateral and the money from the loans siphoned off by “identified company personnel, both current and past, including certain non-executive directors.”

Since then, the stock has seen a spurt in trading activity and hit lower circuit limits in each trading session on BSE.

The scrip on August 26 hit the lower circuit of Rs 8.65, the new 52-week low on BSE.

Apart from CG Power, a limit of 5 percent has been set for GFL, Acewin Agriteck, Opto Circuits (India) and Unitech while a limit of 10 percent has been set for Gallant Ispat Ltd.

Circuit filter mechanism is used by stock exchanges to keep excessive volatility for a scrip in check. It is the maximum fluctuation that is allowed in a stock, after which trading in it gets suspended if the permissible limit is hit in either direction.

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

Supreme Court asks government to consider taking over Unitech

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

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The Supreme Court on Thursday asked the government to look into the possibility of it taking over the Unitech Group and complete the pending housing projects to protect the interest of home buyers.

A two-judge bench headed by Justice DY Chandrachud said it would like to hear Attorney General KK Venugopal’s views in the matter. The government could look at the possibility of completing these housing projects, which would be a relief for home buyers, who had invested their hard-earned savings into it.

During the hearing, the forensic auditors told the court that officials of Unitech were not cooperating in divulging details of data, especially diversion of funds, to other entities.

Learning about the non-cooperation of Unitech officials with the forensic auditors, the court said in view of such happenings, it will have no other option but to hand over the case to the CBI.

Advocate Pawan Shree Agrawal, who is appointed as amicus curiae, told the court that municipal authorities in Gurugram have already initiated auctioning of the group’s properties, and that there is a possibility it could fetch hundreds of crores.

The amicus curiae in its earlier report had said 61 projects out of 74 are complete and nearly 16,300 home buyers have invested in these projects.

The bench then said auction should be stayed until the disposal of the pending petition. On January 23, court had refused to grant bail to Chandra brothers.

The court also ordered withdrawal of all the facilities given to Sanjay Chandra and his brother Ajay Chandra, who are lodged in Tihar jail, saying they should be treated like ordinary prisoners.

In 2017, the top court had issued directions to allow Chandras to meet their lawyers and company officials under normal visiting hours in order to arrange funds for the incomplete projects and return the home buyers’ money in their projects.

The court had directed Unitech to identify top-level officials who are not in jail and ask them to cooperate with the forensic auditors.

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

Realty shares gain on GST rate cut

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

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Shares of most real estate firms advanced on Monday after the GST Council reduced the tax rate on under-construction residential properties to 5 percent from 12 percent. The tax rate on affordable housing was also cut to 1 percent from 8 percent earlier.

At 10.18 AM, the Nifty Realty Index was up over 1 percent led by Unitech, which rose nearly 4 percent.  Shares of Sunteck Realty, Brigade Enterprises and Godrej Properties advanced over 2 percent. Indiabulls Real Estate, Oberoi Realty and Phoenix Mills gained up to 1.5 percent.

Here are few brokerage’s viewpoint on the aftermath of the GST Council’s rate cut:

Axis Capital said the luxury markets will likely benefit the most because the impact of disallowing input tax credit (ITC) will be minimal in these markets. Passing on the benefits of lower GST to customers will result in improvement in volumes and thus would help stressed developers to liquidate inventory and improve their cash flow position, added the brokerage.

Motilal Oswal expects fence sitters to show interest in buying under construction property and spur demand. Under the current situation and state of the real estate market, it will be difficult for developers to pass on the increased cost which shall be absorbed into the margins, added Motilal Oswal.

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

For lakhs of India’s stuck homebuyers, it was yet another Diwali with no lights, no homes

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

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This year, on behalf of 4.5 lakh homebuyers stuck in delayed projects across India, we declared what is usually an occasion of festivities, lights, colour and joy, a Black Diwali. The stories we collected on the recent CNBC-TV18 campaign, along with Forum for People’s Collective Efforts (the erstwhile Fight For RERA group), broke our hearts.

Suddenly there were faces to the pall of despair we encounter every day on social media and other online forums. They belonged to people from a wide range of backgrounds — middle class families, retired couples and aging parents. The common thread running through all of them: a financially debilitating life of rented apartments and hefty EMIs.

The Slow Wheels of Justice

They are bewildered how every justice system of the country has failed to deliver their homes. And their anguish is bottomless.

The cruellest shock for the stuck homebuyer has been the failure of RERA, or the Real Estate Regulation Development ACT. RERA is the much celebrated and constantly touted “saviour of homebuyers” law by the government.

Notified two years ago, most industry watchers had anticipated a slow rollout of the act simply because the final implementation rested with the respective states as land and housing are state subjects. Most of us had also forewarned that RERA will be of little help in badly stranded cases like JP Infratech and Unitech.

These are prominent promoters with multiple delayed projects, already dragged to various courts by buyers and lenders. But what is shocking is that not a single case of a substantially delayed project has been resolved by any state RERA authority across the country.  The callousness with which RERA implementation has been undertaken by states is shocking. In several states, the permanent regulator and/or appellate tribunals are still missing. RERA registrations are being done manually. Fully functional websites are missing.

A Failure Called RERA

This is dangerous. Any order passed by an interim regulator or an ill-formed tribunal is simply “bad in law”. This is precisely what happened in Rajasthan, where the petitioners (builders) secured a stay on RERA orders in the high court. How?  Because these were passed by the state’s food and safety tribunal, which was delegated the job of doubling up as a RERA Tribunal! This, in a BJP-governed state.

No wonder the repeated lines the housing ministry dishes to a questioning journalist that RERA is well in place in most states is met with all-round cynicism. Even today, the six North Eastern states where land and other issues were cited as a common reason for exemption have not started any meaningful work on RERA.

Here is the truth about RERA — it’s a well-framed law, but has been made toothless and redundant by poor implementation. The unsuspecting homebuyers perhaps don’t even know that any judgments post May 2017 from an interim regulator or an ill- conceived appellate tribunal can easily be challenged and stayed in a high court.

Even in states where RERA implementation has been better than most, the buyers have had no recourse but to fight their cases in multiple courts. But look at the travesty. Rulings by the National Consumer Dispute Resolution (NCDRC) — the highest consumer court — asking builders to pay up penalty and refund principle amounts for undelivered homes are flouted with impunity by erring builders.

The most commonly cited excuse by builders is “we don’t have the money to either build or refund”. So where has the 90 percent of the money collected from homebuyers gone?

That has been siphoned off into shell companies, diverted to buying land banks and spent in living lavish lifestyles.

Let’s Talk About Rogue Builders

Amrapali Group is a case in point. The Supreme Court-ordered forensic audit has revealed huge diversion of funds into shell companies and outright fraud.  And this fraud was discovered in an investigation where auditors struggled to get the documents from the promoters and were stonewalled by the company CFO (chief financial officer) who had partial or complete amnesia.

“The money (diverted by the group) has to be retrieved. Forensic audit is for this purpose and also how to catch the persons behind this and send them behind the bars if needed. This is a big racket that needs to be unearthed,” said the ruling bench of the Supreme Court.

Why just Amrapali though? Why not 3Cs, why not HDIL, why not the promoters of 100 other projects where buyers are running pillar to post?

Let’s not forget Unitech. Buyers have provided Supreme Court with documented evidence of multiple shell companies and diversion of Rs 4,500 crores. The hasty retreat of the government from its bid to take over Unitech, when pulled up by the then Chief Justice of India in December 2017 leaves many troubling unanswered questions.

Does The Government Care?

How can a government, which had claimed that the affairs of the company were being run against the public interest, give up so easily? The promoters are in jail because the Economic Offense Wing found evidence of misappropriation of funds.

There are several instances where courts have displayed commendable empathy for stuck homebuyers. What baffles us though, why do they get so easily blindsided?

Take for example the National Company Law Tribunal (NCLT) order asking Jaiprakash Associates Ltd (JAL) to return nearly 760 acres to its subsidiary Jaypee Infratech, declaring the transfer of the land as “fraudulent” and “undervalued”. Why has this ruling been sidestepped and now embroiled in the next round of insolvency? Is it because the bank which has extended the loan to JAL against the land is fighting to retain it?

The Unheard, Unseen Cases

These are a handful of high-profile cases which get national media attention and raise perplexing questions. But there are hundreds more out there, away from the glare of the media and public attention. We discovered them this time around when we asked homebuyers of stuck projects to register their delayed projects.

Have you heard of projects like Ekta Parksville, Sunbreeze, Ourania? From the list, it seems there is no city in India where there isn’t an incomplete or abandoned project.

What do the homebuyers do then? Banks and housing finance companies won’t let them off the hook on paying EMIs, despite being equally responsible in this mess by giving their stamp of approval on these delinquent projects.

Can the homebuyers hope for some light by next Diwali?  The solutions maybe not be perfect but are not hard either. They have been cited publicly by anguished homebuyer.  They were also echoed by our panel of experts on the Black Diwali Special show. I’m going to sum up the only way forward.

Order an immediate forensic audit into every project which is stuck for over two years. Forum for People’s Collective Effort (FPCE) has already prepared the list by states and regions. Several new names have been added to the joint campaign we’ve run over the last fortnight.

There is no reason why both the centre and respective states cannot act upon this list immediately.

Appoint fast-track courts to examine these cases and review the forensic results. Ten years of reeling under the double burden has killed the proverbial camel’s back. This can’t go on endlessly between courts, RERA and NCLT.

If fund siphoning and fraud are established, throw the promoters to jail with common criminals. No more VIP cells or hotel stays. Attach all their personal properties.

Many of them are living a pretty cushy life in plush bungalows. Funds diverted to shell companies, relatives, into land parcels should be traced and brought back.

Personal and company land/assets should be sold by court appointed liquidators, at whatever market value they fetch. Even if they have to go at distress value. Ever rupee recovered that can go into completing flats matters.

The central government’s role of keeping a close tab on whether states are adhering to the central legislation and implementing it in true letter and spirit is far from over. States which haven’t already done so have no excuse left for not appointing a permanent regulator or an appellate tribunal headed by sitting or a retired judge of the high court.

And the states should not be let off the hook.  Even the very basic information dissemination on RERA-registered projects is dismal on several of the state RERA portals.  So forget about a resolution for stuck projects, RERA isn’t even sharp enough to protect new homebuyers in several parts of the country.

The goal of the central government must be to act fast and make RERA as strong as Sebi (Securities Exchange Board of India), which will not just catch the crime once it’s committed but also monitor the industry vigilantly enough to prevent the crime. Until then, RERA won’t achieve its purpose.

It’s perhaps also time for the government to recognise that the Insolvency and Bankruptcy Code, or IBC is not the answer to the plight of homebuyers. Buyers are not “financial creditors”. They did not lend to the builder. They bought a home from him. Treating homebuyers at par with institutional lenders and banks is turning out to be more of a disservice than relief.

Look at the JP Infra mess. Expecting 22,000 homebuyers to vote in JP Infra proceedings is asking for the moon.

The current prescribed procedure for determining voting percentage fragments the position of homebuyers. And if these rules are not changed at the earliest, which will enable taking into account only the actual votes cast, the company may be pushed into insolvency, leaving the homebuyers scraping the bottom of an empty barrel at the end of another two years.

Finally, the government should once and for all stop using National Buildings Construction Company (NBCC) as a front to eye-wash homebuyers into believing that it will step in to complete the unfinished projects. NBCC chairman has repeatedly said, they do not have the means and resources to cough up the gap funding. How can they? A listed company is answerable to shareholders.  So unless the government has plans to make that gap funding available, better to stop running that charade.

Let’s hope, if nothing else, the forthcoming elections will bring the government’s attention to the plight of the middle class homebuyers and we won’t have a reason left to repeat another #BlackDiwali show in 2019.

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

Unitech appoints Hemangi Dhir as non-executive independent director

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

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Crisis-hit Unitech has appointed Hemangi Dhir as an additional non-executive independent director of the company.

With appointment of Dhir, the company said it was complying with the mandatory provisions of Sebi (Listing Obligations and Disclosure Requirements) Regulations, 2015, regarding combination of directors with at least one woman director.

In a regulatory filing, Unitech said the appointment has been made with effect from October 3, 2018, for a term of five years.

Dhir is a Bachelors of Science in Finance and Management from University of South Carolina, United States. She is managing partner in garment export house since 2012.

She has worked with Ernst & Young, Washington DC.

Gurugram-based Unitech has defaulted in making timely deliveries of its housing projects across the country, forcing buyers to protest and file legal cases in courts. The company has been trying to sell off its assets to complete projects, but without much success.

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

Unitech’s fourth quarter net loss widens to nearly Rs 1,000 crore

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

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Crisis-hit realty firm Unitech today reported a consolidated net loss of Rs 999.83 crore for the quarter ended March 31, 2018, despite higher income. The Gurugram-based developer had posted a net loss of Rs 290.19 crore in the year-ago period, according to a regulatory filing.

Total income however jumped over two fold to Rs 977.59 crore during January-March, 2017-18 from Rs 480.36 crore in the year-ago quarter.

Despite sharp rise in income, the company has posted net loss due to higher operational expenditure and an exceptional item of Rs 928 crore.

For entire 2017-18, Unitech posted a net loss of Rs 1,275.07 crore as against a loss of Rs 402.66 crore in 2016-17.

Total income however increased to Rs 2,210.19 crore from Rs 1,795.25 crore in 2016-17.

Debt-ridden Unitech is facing huge protest as well as litigations from home buyers because of significant delays in completion of their housing projects across the country.

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