We’re servicing our debt, trimming arrears: Anil Ambani
Says Reliance Group company stocks are victims of ‘rumours, bear hammering’
Reliance Group Chairman Anil Ambani on Tuesday emphatically said the group is servicing its debt payments and will continue to reduce its arrears.
In a hurriedly organised conference call, Ambani said “unwarranted” rumours and “bear hammering” have damaged the value of the group’s stocks.
These observations come in the backdrop of ratings agencies such as CARE and Brickwork Ratings downgrading almost all the companies of the group.
Industry watchers estimate that the overall debt position of Reliance Group companies — including Reliance Communicaitons — is around ₹1 lakh-crore.
Reassuring investors, Ambani said the group has serviced debt payments of over ₹35,000 crore in the last 14 months. This included principal payments of ₹25,000 crore and interest payments of ₹11,000 crore.
He added that during the 14month period, lenders from all categories, such as banks, mutual funds, insurance companies, Provident Fund and NBFCs, have not provided any additional liquidity to any of the group’s entities. “These payments have been made in the face of insurmountable odds and the most challenging financial environment in the country in decades,” he said.
Ambani was also particularly irate that the regulatory bodies and courts have not passed any final adjudication order on claims aggregating over ₹30,000 crore that are due for 5-10 years to various Reliance Group companies, especially Reliance Infrastructure, Reliance Power and their affiliates.
‘Apathy, lack of support’
He also blamed the financial system, which he said has shown total apathy and lack of any support, significantly hurting the interests of lenders as well as all other stakeholders. “Despite the lack of support, the group is committed to paying off all of its debts,” he said.
These developments come at a time when the group’s non-finance businesses are seeing tough times. Reliance Power has posted its biggest ever quarterly loss in the January to March quarter and Reliance Infrastructure has deferred its quarterly results for the second time. CARE said Reliance Capital has ‘sizeable exposure to group companies’ in the non-financial business segments. Further, these firms have weak financial profiles and require continued support from Reliance Capital, the report said.
Reliance Capital is in the process of monetising its entire 42.88 per cent stake in Reliance Nippon Life Asset Management.
It has also announced plans to monetise a 49 per cent stake in Reliance General Insurance. “I’m personally confident that the journey we have undertaken to be capital light, bare minimal debt and high Return on Equity will enhance all shareholders,” said Ambani.
“These payments have been made in the face of insurmountable odds and the most challenging financial environment in the country in decades.”