HPL board might OK fund infusion

TCG chief Purnendu Chatterjee, key private promoter of HPL, says no need to worry about HPL's fate, but refuses to give further details

Haldia Petrochemicals Ltd’s board of directors met on Monday to decide fund infusion in the company. It is likely to approve the proposal before the end of this month, to keep the company from having to knock the doors of the Board for Industrial and Financial Reconstruction. The meeting was chaired by the additional secretary of West Bengal’s industry department, C M  Bachhawat, as HPL’s board does not have a chairman at present.

Company officials refused to comment on the meeting, saying that would violate the code of conduct, as dates of the Lok Sabha elections had been announced. The state government is the principal promoter of the ailing company. After the board meeting here, Purnendu Chatterjee, chief of The Chatterjee Group, the other key HPL promoter, said there was no need to worry about the company’s fate, without giving any detail. Former HPL chairman Chatterjee has emerged as a contender for the post again.

Sources said lenders might agree to infusing more funds into HPL if, among other things, the board were to make Chatterjee the chairman.

“It is anyone’s guess that the primary issue for HPL is to have funds infused so that it does not become an NPA (non-performing asset or a loan defaulter) in bankers’ accounts as well. Lenders and key stakeholders have discussed the options and hopefully that will save the day for the company,” a source said. HPL might turn a sick unit, with its net worth eroding continually owing to a shortage of naphtha, needed to run the plant to full capacity.

Meantime, state-owned Indian Oil Corporation, which emerged as the sole bidder for the state government’s 40 per cent stake on sale, is yet to receive any communication over the fate of the stake sale. After Chatterjee’s exit from the company, an approved Rs 1,300-crore rights issue was put on the back burner, with no word from the promoters on it.