PTC India Financial Services Ltd updates on Surana Power Ltd account

M/s Surana Power Limited (SPL) was executing 420 MW (2 x 210) Coal based Thermal Power Plant in Raichur District, Karnataka. PTC India Financial Services Ltd (PFS), inter-alia, is a lender to the SPL. The CIR Process under IBC was initiated against SPL in February, 2018 and since no resolution plan was received, the company was ordered to be liquidated in January 2019. Subsequently, all the secured lenders except BHEL relinquished their security interest in favour of the liquidator. BHEL, which was earlier awarded through an ex-parte Arbitration Award and based on which BHEL had been granted lien over the equipment and goods lying at the site of the SPL and charged over its entirely or partially erected facilities at the site of SPL was created. BHEL did not relinquish its security interest in favour of the liquidator and thus the liquidator was unable to proceed with any further sale of assets without the receipts of relinquishment of security interest from all the secured creditors to whom the said assets are charged.

In this regard the liquidator approached Hon’ble NCLT Chennai for a direction against BHEL’s decision. The Hon’ble NCLT Chennai has ordered against liquidator’s pleas and gave a priority charge on the asset of Surana Power Ltd to BHEL. The liquidator has filed appeal against the said order to NCLAT. NCLAT vide its judgement dated 18th June 2020 set aside the impugned order of NCLT order stating that BHEL does not have a requisite 60% value in secured interest, therefore, BHEL does not have right to realize its security interest, because it would be detrimental to the liquidation process and the interest of the remaining ten secured creditors. Further, the NCLAT directed the liquidator to complete the Liquidation Process in the light of direction above.

The above is an important judgement by NCLAT which will benefit other such cases which are in liquidation under IBC. PFS has already provided for its entire outstanding of SPL and any further recovery during liquidation would add to its profitability.

PFS during last two years i.e. FY18-19 to FY19-20, resolved 9 stressed accounts (principal outstanding cumulatively ~Rs 1087 crores) through multi-pronged approach such as sale to ARC, IBC, SARFAESI & One Time Settlement (OTS). Further, PFS is in advance stage of resolving two more stressed accounts.

Shares of PTC INDIA FINANCIAL SERVICES LTD. was last trading in BSE at Rs.12.95 as compared to the previous close of Rs. 12.57. The total number of shares traded during the day was 120626 in over 414 trades.

The stock hit an intraday high of Rs. 13.24 and intraday low of 12.61. The net turnover during the day was Rs. 1562541.

Source : Equity Bulls

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