May not be able to repay due in the near future: DHFL to stock exchanges

Crisis-hit Dewan Housing Finance (DHFL) has informed the stock exchanges that it may not be able to repay due in the near future as the firm is in talks with lenders on the resolution plan they have submitted. 

“We, however, would like to reiterate that the company remains committed to resolving the issues being faced by it and is making all-round efforts to work out a resolution plan which will be in the best interest of all stakeholders,” the company said.

DHFL has submitted its resolution plan before the lenders who have signed the inter-creditor agreement. In an exchange filing on Tuesday, DHFL said the draft plan, made in consultation with a special committee and EY, its financial advisor, was submitted to the lenders. 

Banks have an exposure of Rs 40,600 crore to DHFL as on March 31, while the firm has an obligation of Rs 45,380 crore towards those holding its bonds and debentures. DHFL’s total liabilities are to the tune of Rs 90,000 crore.

In the plan by DHFL, creditors may not have to take a haircut on the principal loan exposure to it. Moreover, the mortgage lender has sought fresh loans of Rs 1,200-Rs 1,500 crore a month, which will be backed by loans the firm will extend upon restarting of its business. 

It has also sought moratorium on these fresh loans. DHFL is also seeking fresh lines of credit from banks and National Housing Bank for restarting its retail lending business.

The mortgage lender has been facing liquidity crisis since September 2018 after IL&FS defaulted on its debt obligations. However, Rs 41,000 crore has been discharged by the company as towards its financial obligations despite acute funding problem.