Altico Capital's chief executive officer Sanjay Grewal quits amid crisis

Sanjay Grewal, chief executive officer (CEO) of troubled real estate financier Altico Capital, resigned on Tuesday. 

This comes at a time when lenders are cobbling up a restructuring package for the finance company that defaulted on payments. No replacement for Grewal has been found yet. The expectation is that this is the time when the senior management member should be staying on to tide over the hard times, a senior banker said.

He came on board as CEO in early 2016. Grewal had served as corporate and investment banking head for IDFC Bank. Before that, he was the group co-head of project finance of IDFC. On September 3, Naina Lal Kidwai (former head of HSBC India & past president of Federation of Indian Chambers of Commerce & Industry (FICCI)) resigned as chairperson & independent director from Altico. Lenders to the troubled real estate financier have started preliminary work on restructuring debt of over Rs 4,000 crore.

Altico Capital, backed by private equity investors, missed on payments on external commercial borrowings (ECBs).  It defaulted on interest payment of Rs 19.97 crore on ECBs it had availed from Mashreqbank PSC. The gross principal amount was Rs 347 crore.

India Ratings downgraded the rating of Altico to ‘IND A+/A1(negative)’ from ‘IND AA-/A1+’(stable). 

This rating downgrade led to acceleration triggers on some of the outstanding borrowings of the company, leading to creation of asset-liability mismatch in the near term.

The company continues to remain well capitalised with net worth of Rs 3,108 crore as of June 30, and capital adequacy of 43 per cent. 

Net gearing of the company is less than 1.5 times as of June 30. 

The reported gross non-performing asset (GNPA), according to the last management mail, is 1.8 per cent.