Govt may give Rs 2,500 crore bank guarantee for STC

NEW DELHI: State Trading Corporation (STC) may soon get relief from the government in terms of bank guarantee of Rs 2,500 crore to help the company resolve the liquidity problem, sources said.

The commerce ministry has approved the proposal and sent that to the finance ministry for final approval.

“There is also a plan to restructure loans of STC as the company is facing financial hardship,” the sources said.

The firm is also in the process of preparing a plan to sell its non-core assets to raise funds.

The move assume significance as there was a proposal of the commerce ministry for a merger of STC and another state-owned trading firm MMTC.

STC has posted 88.44 per cent fall in standalone net profit to Rs 1.46 crore during AprilJune 2018-19, on account of poor income.

The company, while releasing its unaudited financial result for the quarter ended June 30, 2018 in August, had stated that it has appointed financial advisor for restructuring of existing loans and for raising additional loans.

It had also proposed to raise additional working capital funds against its properties.

The meeting, coordinated by the NITI Aayog, is likely to focus on challenges posed by volatile oil prices and the US sanctions on Iran