Resolution-bound SREI Infrastructure Finance and SREI Equipment Finance have debt obligations of over ₹29,000 crore with bank facilities of over ₹28,000 crore.
According to the most recent note by CARE Ratings in March this year, SREI Equipment Finance has long-term and short-term bank facilities of ₹16,912.21 crore, non-convertible debentures of a little over ₹352 crore, unsecured subordinated Tier II NCDs of ₹109.8 crore and perpetual debt of ₹37.5 crore.
Similarly, by March this year, SREI Infrastructure Finance had short-term and long-term bank facilities of ₹11,117.71 crore, long-term infrastructure bonds of ₹20.22 crore, NCDs of ₹95.9 crore and unsecured subordinated Tier II NCDs of ₹594.51 crore.
According to an Acuite Ratings report in March, Srei Equipment Finance had NCDs of ₹3,492.45 crore.
Both CARE Ratings and Acuite had revised their ratings for the SREI companies.
According to sources, UCO Bank, Punjab National Bank and State Bank of India have amongst the highest exposure to the two firms.
However, most banks have been providing for their exposure to the two companies.
The Reserve Bank of India had, on October 4, superseded the boards of Srei Infrastructure Finance (SIFL) and Srei Equipment Finance (SEFL), paving the way for their resolution.
It has also appointed Rajneesh Sharma, Ex-Chief General Manager, Bank of Baroda, as the Administrator of the companies under Section 45-IE (2) of the RBI Act.
On Tuesday, SREI Infrastructure Finance was down five per cent at ₹8.17 apiece on BSE.
Hemant Kanoria, former Chairman of SREI Infrastructure Finance, in the Annual Report, had said that the company was primarily dependent on borrowings from banks and other lenders for deployment of funds towards financing for asset creation. The Covid pandemic has had an adverse effect on its customers, which has affected cash flows, resulting in muted collections, he had said.
The company had also been reducing its infrastructure portfolio and realigning the equipment financing business to the extant regulations, but it was “derailed” to some extent by the pandemic.