The Indian infrastructure finance firm behind a rare default last month that is reverberating through the nation's credit markets is delinquent on more borrowings, people familiar with the matter said.
Infrastructure Leasing & Financial Services Ltd., which helped fund India’s longest tunnel, is in default on Rs 3 billion of short-term borrowings taken through so-called inter-corporate deposits from Small Industries Development Bank of India, the people said. Government-backed SIDBI has sought a repayment plan, according to the people, who asked not to be identified because the details are private.
The mounting troubles come after IL&FS missed payment on commercial paper last month in a rare development for India’s short-term debt market, fanning concerns among investors in the money-market funds that hold such securities. The Reserve Bank of India has initiated a special audit of the firm, BloombergQuint has reported.
IL&FS has another Rs 1.5 billion inter-corporate deposit payment due on September 14, according to the people. SIDBI has asked IL&FS to submit a plan within 10 days to repay the Rs 3 billion defaulted portion plus the Rs 1.5 billion coming due on September 14, they said.
IL&FS had three tranches totalling 3.5 billion rupees of ICDs from SIDBI due on different days since August 27. It hasn’t made full payment on any of those tranches, and has only paid Rs 500 million toward the total, leaving Rs 3 billion unpaid, the people said.
A SIDBI spokesman and an IL&FS spokeswoman declined to comment.