Sharemasterindia.com: Bhushan Steel shares surged 20 per cent to its maximum intraday limit of
Rs 65.80 on Thursday after its chief finance officer (CFO) Nittin
Johari told Press Trust of India that its lenders have approved
long-term restructuring of about Rs 30,000 crore loans, under the 5/25
scheme of the Reserve Bank of India.
The Bombay Stock Exchange has sought clarification from Bhushan Steel on this.
Under the 5/25 scheme, the Reserve Bank has allowed banks to restructure loan term infrastructure loans extended to corporates for a maximum period of 25 years, with a provision to restructure it in every five years.
Mr Johri said the joint lenders forum (JLF) has agreed to extend the loans of Bhushan Steel for a tenure of 25 years under the RBI's scheme for long-term structuring of loans in line with its cash flows.
"About 70 per cent of the lenders have approved the scheme and by the end of this month it should get closed", Mr Johari told Press Trust of India.
Under the restructuring plan, Bhushan Steel has been given a four-year moratorium on principal repayment and after that there will be a 21-year repayment period, with a provision to refinance the loan in every five years, Press Trust of India said, quoting Mr Johri.
A consortium of bankers led by Punjab National Bank (PNB) has a total exposure of about Rs 30,000 crore in Bhushan Steel.
Besides PNB, the other banks include State Bank of India, Canara Bank, Bank of India and Dena Bank.
An extension of maturity will help Bhushan Steel reduce its per-year debt repayment liability and it will also help the banks in making lower provision for the loan given to the debt-ridden steel manufacturer.
Bhushan Steel's net loss had widened to Rs 360.77 crore during the fourth quarter of previous fiscal. For the entire 2014-15 fiscal, Bhushan Steel's standalone net loss stood at Rs 1,253.83 crore as against a net profit of Rs 61.96 crore in fiscal year 2013-14.
As of 11.45 a.m., shares in Bhushan Steel shares were locked at upper circuit with 20 per cent gains at Rs 65.80 apiece, against 0.12 per cent loss in the broader Nifty.
The Bombay Stock Exchange has sought clarification from Bhushan Steel on this.
Under the 5/25 scheme, the Reserve Bank has allowed banks to restructure loan term infrastructure loans extended to corporates for a maximum period of 25 years, with a provision to restructure it in every five years.
Mr Johri said the joint lenders forum (JLF) has agreed to extend the loans of Bhushan Steel for a tenure of 25 years under the RBI's scheme for long-term structuring of loans in line with its cash flows.
"About 70 per cent of the lenders have approved the scheme and by the end of this month it should get closed", Mr Johari told Press Trust of India.
Under the restructuring plan, Bhushan Steel has been given a four-year moratorium on principal repayment and after that there will be a 21-year repayment period, with a provision to refinance the loan in every five years, Press Trust of India said, quoting Mr Johri.
A consortium of bankers led by Punjab National Bank (PNB) has a total exposure of about Rs 30,000 crore in Bhushan Steel.
Besides PNB, the other banks include State Bank of India, Canara Bank, Bank of India and Dena Bank.
An extension of maturity will help Bhushan Steel reduce its per-year debt repayment liability and it will also help the banks in making lower provision for the loan given to the debt-ridden steel manufacturer.
Bhushan Steel's net loss had widened to Rs 360.77 crore during the fourth quarter of previous fiscal. For the entire 2014-15 fiscal, Bhushan Steel's standalone net loss stood at Rs 1,253.83 crore as against a net profit of Rs 61.96 crore in fiscal year 2013-14.
As of 11.45 a.m., shares in Bhushan Steel shares were locked at upper circuit with 20 per cent gains at Rs 65.80 apiece, against 0.12 per cent loss in the broader Nifty.
