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Mumbai: L&T Financea subsidiary of the listed L&T Finance Holdingssold a stressed portfolio with total debt of ₹1,800 crore to Kotak Mahindra Bank-backed Phoenix Asset Reconstruction Company (ARC) said at an auction last week that people are aware of the development.
portfolio included six real estate The accounts were sold for ₹1,075 crore, which amounts to a 60% recovery for L&T Finance, the people said. According to a notice released by the finance company on its website early last month, the finance company had invited offers under the 15:85 structure for ten accounts with a total loan of ₹3,022.5 crore.
Phoenix Arc Nirmal Lifestyle Developers with total debt of ₹790 cr, Nirmal Lifestyle Mall with debt of ₹231 cr, Brownish Realty (₹222 cr), Coast Realtors (₹113 cr), Poise Realtech (₹279 cr) and SU Toll Road (₹168 crore).
The other four accounts that were on sale but did not receive any offers include Supertech with a loan of ₹515 crore, Mabsuit Buildhomes (₹276 crore), Coast Town Planners (₹279 crore) and Perpendicular Construction (₹148 crore) Are.
L&T Finance and Phoenix ARC did not respond to ET’s request for comments. Over the past few quarters, L&T Finance has been regularly selling distressed loans under a 15:85 structure, wherein 15% of the consideration is paid upfront and ARCs for 85% issue security receipts which can be used to recover the loans. But it is redeemed. Phoenix ARC has also acquired the portfolio under the 15:85 structure, the people said.
In March, L&T Finance sold its distressed loan portfolio of ₹880 crore to Avenue Capital-backed Asset Reconstruction Company of India (Arcil) for ₹700 crore under a 15:85 structure, as reported by ET on March 28. Portfolio of ₹880 crore. This included five real estate loans given to Pune-based Xarbia Group. During the December 2022 quarter end, L&T Finance and its subsidiary L&T Infra Credit jointly sold ₹1,827.5 crore distressed loan pool to Arcil for ₹1,092.5 crore under a 15:85 structure, as on December 31 ET Reported by.
In its quarterly results, L&T Finance Holdings does not disclose its gross or net non-performing assets to investors. Its gross stage three (GS3) loans stood at ₹3,832 crore or 4.7% of total loans at the end of March 2023, according to the company’s presentation to analysts.
GS3 stood at ₹3,543 crore or 4.08% a year ago. This includes loans outstanding for more than 90 days and other stressed assets.
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