Lenders to IL&FS Tamil Nadu Power Company (ITPCL), which is undergoing insolvency proceedings, are likely to meet this week to finalise a restructuring plan, a source said.
ITPCL is a special purpose vehicle (SPV) incorporated by the IL&FS Group under its energy platform (IEDCL) for implementation of a thermal power project at Cuddalore in Tamil Nadu.
The company recently received RP4 rating from Crisil, which is required for implementation of a resolution plan for stressed companies.
"The financial creditors of ITPCL are most likely to e-vote on the proposal this week to conclude the restructuring," the source said.
ITPCL's consortium of lenders include 19 banks and financial institutions led by the Punjab National Bank.
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It owes over Rs 6,700 crore to its lenders and around Rs 900 crore to IL&FS Group entities, according to the affidavit submitted by IL&FS before the National Company Law Appellate Tribunal (NCLAT) in January.
IL&FS had earlier initiated restructuring of ITPCL, which also included selling its stake to the Tamil Nadu government and other stakeholders, but it was unsuccessful.
When contacted, an IL&FS spokesperson confirmed that ITPCL has received RP4 rating from Crisil.
As per the Prudential Framework for Resolution of Stressed Assets issued by the Reserve Bank of India (RBI) on June 7, 2019, all resolution plans involving restructuring or change in ownership in respect of accounts where exposure of lenders is Rs 100 crore and above, will require independent credit evaluation (ICE) of the residual debt by authorised credit rating agencies (CRAs)
In case of accounts with aggregate exposure of Rs 500 crore and above, two such ICEs will be needed.
Only those resolution plans that receive a credit opinion of RP4 or better for the residual debt from one or two credit rating agencies, will be considered for implementation, RBI had said.
ITPCL is setting up a 3,180 MW thermal power plant in Kothattai, Ariyagoshti and Villianallur revenue villages of Chidambaram taluk, Cuddalore district.
The project was being implemented in phases, with phase I of the project for 1200 MW comprising two units of 600 MW each and a second phase of 3 x 660 MW.
According to the affidavit, ITPCL had entered into power purchase agreements (PPAs) with the Tamil Nadu Generation and Distribution Corporation (TANGEDCO) and PTC India.
TANGEDCO and PTC India owe around Rs 1,700 crore to ITPCL on account of power supplied by ITPCL to both the companies, as per the PPAs.
The restructuring efforts and recovery to lenders of ITPCL have also been hindered due to the overdue payments from TANGEDCO and PTC, IL&FS had said in the affidavit.
ITPCL was categorised as an 'amber' entity by IL&FS but it had stopped servicing interest and principal on term loans and debt obligations since November 2018.
Due to this, banks have restricted the usage of working capital limits for the company and it is reliant only on collection from sale of power for its operations.
Various companies in the IL&FS Group have been classified as 'green', 'amber' and 'red' categories depending on their ability to service debt.
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