Electrosteel Steels gains after CDR approval

Electrosteel Steels rose 2.5% to Rs 4.10 at 14:14 IST on BSE after the company said that the application of the company for restructuring of its debts to the tune of Rs 6181.20 crore has been approved by CDR EG under the CDR mechanism.

The announcement was made during trading hours today, 30 September 2013.

Meanwhile, the S&P BSE Sensex was down 247.19 points or 1.25% at 19,480.08.

On BSE, 3.29 lakh shares were traded in the counter as against average daily volume of 1.73 lakh shares in past one quarter.

The stock hit a high of Rs 4.44 and a low of Rs 3.92 so far in the day. The stock had hit a 52-week high of Rs 9.10 on 5 October 2012. The stock had hit a record low of Rs 2.56 on 29 July 2013.

The stock had outperformed the market over the past one month till 27 September 2013, surging 37.93% compared with the Sensex's 9.79% rise. The scrip had also outperformed the market in the past one quarter, jumping 24.61% as against Sensex's 4.51% rise.

The small-cap company has equity capital of Rs 2186.74 crore. Face value per share is Rs 10.

Electrosteel Steels said that the application of the company for restructuring of its debts to the tune of Rs 6181.20 crore has been approved by CDR EG under the Corporate Debt Restructuring (CDR) mechanism from cut off date of 1 March 2013. The term loan outstanding of non-CDR lenders amounting to Rs 611.91 crore will be outside the purview of CDR, the company said.

It may be recalled that Electrosteel Steels' board of directors at a meeting held on 20 May 2013 decided to approach its bankers/lenders through the CDR process for restructuring the company's entire debt as the company could not achieve the "Financial Closure" of the additional loan on time as required for the project.

Electrosteel Steels reported a net loss of Rs 70.74 crore in Q1 June 2013, higher than net loss of Rs 46.20 crore in Q1 June 2012. Net sales rose 900.2% to Rs 119.82 crore in Q1 June 2013 over Q1 June 2012.

Electrosteel Steels (ESL) is an associate company of Electrosteel Group, is setting up a 2.2 million ton per annum (MTPA) Greenfield Integrated Steel & DI Pipe Plant to produce 1.2 MTPA long product of steel, 0.27 MTPA commercial billet, 0.4 MTPA pig iron and 0.33 MTPA Ductile Iron Pipe. The proposed plant will be based on Coke Oven, Sinter Plant, Pellet Plant, Blast Furnace, Basic Oxygen Furnace, Billet Caster, Wire Rod Mill and Bar Mill.

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