Bankers unsure of ADAG’S debt repayment
He said “rumour mongering, speculation, and bear hammering” resulted in a steep fall in all the Reliance Group company shares over the past few weeks. Ambani said this had “caused grave damage” to all the stakeholders.
Giving a further breakdown of payment from April 1, 2018, to May 31, 2019, Ambani said Rs 25,000 crore had been paid towards principal leading to overall debt reduction and Rs 10,000 crore towards interest payments. Ambani said the company disclosed that the debt servicing payments of Rs 35,000 crore had been made almost entirely from asset monetisation despite a liquiditystarved environment and operational cash flows in an operating environment beset by procedural and regulatory hurdles. He said this amount included debt servicing payments by Reliance Capital Group, Reliance Power group, Reliance Infra group, and respective affiliates.
“During the last 14 months, lenders from all categories - whether banks, mutual funds, insurance companies, provident funds or NBFCS - had provided zero net additional liquidity or debt to any entity of the Reliance Group,” Ambani said. He blamed regulatory institutions and courts for the delay in passing verdicts, which had kept the group from receiving dues of over Rs 30,000 crore.
“To compound matters, the regulatory bodies and courts have not passed any final adjudication orders on claims aggregating to over Rs 30,000 crore that is due for more than 5-10 years to various Group companies, especially Reliance Infrastructure and Reliance Power, and their affiliates,” said Ambani.
Reliance Group, he concluded, was committed to transformation and become capital light with bare minimal debt and a higher return on equity.
Shares of most Reliance ADAG Group companies closed higher on BSE after Ambani’s statement. Reliance Capital closed at Rs 93.90, up 2.96% higher over the previous close, while Reliance Infrastructure was up 1.17% at Rs 64.95, and Reliance Nippon Life Asset Management Company rose 1.60% to close at Rs 219.70 a share. However, Reliance Naval & Engineering ended 2.62% lower at Rs 6.33 a share.