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SREI Resolution Infrastructure Finance and SREI Equipment Finance have debt obligations over 29,000 crore with bank facilities over ₹ 28,000 crore.
According to CARE Ratings’ most recent rating in March this year, SREI Equipment Finance has long-term and short-term banking facilities of 16,912.21 crore, non-convertible debentures of just over 352 crore, Unsecured Tier II NCDs of ₹ 109.8 crore and perpetual debt of ₹ 37.5 crore.
RBI replaces boards of two indebted Srei companies
Likewise, in March of this year, SREI Infrastructure Finance had short and long term bank facilities of 11,117.71 crore, long term infrastructure bonds of 20.22 crore, NCD of 95.9 Level II unsecured subordinated NCD and crores of 594.51 crore. .
According to an Acuite Ratings report in March, Srei Equipment Finance had MNTs of 3,492.45 crore.
CARE Ratings and Acuite have revised their ratings for SREI companies.
According to sources, UCO Bank, Punjab National Bank and State Bank of India are among the most exposed to the two companies.
SREI Infrastructure Finance Ltd stuck in 5% bottom circuit as RBI replaces co board of directors
However, most banks have provisioned their exposure to both companies.
The Reserve Bank of India had, on October 4, replaced the boards of directors of Srei Infrastructure Finance (SIFL) and Srei Equipment Finance (SEFL), paving the way for their resolution.
He also appointed Rajneesh Sharma, former Managing Director of Bank of Baroda, as a corporate director under section 45-IE (2) of the RBI Act.
On Tuesday, SREI Infrastructure Finance was down 5% to 8.17 each against BSE.
The impact of the Covid
Hemant Kanoria, former chairman of SREI Infrastructure Finance, said in the annual report that the company mainly relies on borrowing from banks and other lenders for the deployment of funds towards financing the creation of assets. The Covid pandemic has had a negative effect on its customers, which has affected cash flow, resulting in muted collections, he said.
The company had also reduced its infrastructure portfolio and realigned the equipment financing business to current regulations, but it was “derailed” to some extent by the pandemic.
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