Cox & Kings has defaulted on commercial paper of Rs 125 crore, the tour operator informed the stock exchange on Wednesday. This is the third default of the company in the past fortnight, totaling Rs 325 crore.
The tour operator has been facing a cash crunch resulting in delays in salaries and vendor payments. The International Air Transport Association has suspended the company from selling tickets on credit as it reviews its credit worthiness.
“The company is working closely with its lenders to optimise its strong asset base globally and bring the situation back to normal as soon possible,” Cox & Kings said on Wednesday.
Earlier, it blamed the financial crisis to the cash flow mismatch and downgrade by credit rating agencies. The company had said it would meet all its obligations through a combination of internal accruals and monetisation of assets.
Cox & Kings had a total debt of Rs 3,238 crore at the end of FY19, including both short- and long-term loans. The company has been unable to replace its short-term debt with long-term loans, impacting its liquidity position.