You are here: Home » Companies » News
Business Standard

Kesoram Industries hopes to conclude restructuring process by Dec

Kesoram Industries Ltd is focusing on a sustainable turnaround and expecting to conclude its second phase of restructuring process by inducting a strategic investor into it

Topics
Kesoram Industries | Indian companies

Press Trust of India  |  Kolkata 

companies

B K Birla Group flagship Kesoram

Industries Ltd is focusing on a sustainable turnaround and expecting to conclude its second phase of restructuring process by inducting a strategic investor into it and finalising a debt resolution plan with bankers by the next month, a company official said on Wednesday.

The first phase of restructuring was the demerger of its tyre business from the company and taking it into a new entity, Birla Tyres Ltd, he said.

"We hope to conclude the ongoing restructuring by December. This involves induction of a strategic investor who will infuse funds to create ample liquidity for ramping up operations and clearing of the current dues of the lenders," Kesoram wholetime director and CFO P Radhakrishnan told PTI.

Sources said the strategic investor is expected to infuse fund through a structured debt or may pick up a minority stake.

"The company is likely to rope in US-based fund Farallon Capital to retire its debt to the Indian lenders with whom a settlement scheme is currently being worked out," they said.

After hiving off the tyre division, Kesoram is now mainly a cement company and has a total outstanding loan of Rs 2,038 crore, including Rs 1,500 crore of long-term debt, Radhakrishnan said.

"The overall debt on the company books will not change after the restructuring but we will be in a comfortable position to manage it. This will help ramp up manufacturing operations and improve cash flow," Radhakrishnan said.

The company is now operating at about 50 per cent capacity.

The fresh capital infusion by the strategic partner will help manage the Rs 200 crore working capital shortfall for the company to ramp up its manufacturing capacity, the official said.

The Manjushree Khaitan-led company was back in the black in the second quarter of this COVID-hit fiscal.

The firm had posted a net profit of Rs 31.5 crore from a loss of Rs 31.3 crore in the same period last year.

(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)

Dear Reader,


Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.
We, however, have a request.

As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.

Support quality journalism and subscribe to Business Standard.

Digital Editor

First Published: Wed, November 11 2020. 20:40 IST
RECOMMENDED FOR YOU
.