RBI sent ripples through the financial industry last month when it listed 12 large companies with stressed accounts for insolvency proceedings. RBI ‘s push forced banks to clean-up their balance sheets by disclosing all the hidden NPAs. While these measures uncovered big chunks of impaired assets, its effectiveness to recover the money is yet to be seen. In this series ‘The NPA Saga’ Nexensus takes a closer look at each of these defaulters and their tryst with various lenders.
Although RBI has yet to officially name any of the 12 companies, various sources have confirmed these to be the top contenders. These companies account for nearly 3 trillion rupees of all the country’s bad loans. Interestingly largest lenders in almost all the cases are government backed.
12 Mega Loan Defaulters & the NPA Contribution
Sbicap Trustee Company Limited is the largest lender to 5 of the 12 companies in the defaulters list. It is easy to spot that the largest lenders in almost all the cases are government backed. Interestingly a lot of companies with extremely dismal percentage of loans satisfied and high borrowings have been excluded from this list.
|Company Name||Total Loan Amount Taken (INR Cr)||Loan Amount Repaid (%)||Largest Lender|
|Era Infra Engineering Limited||27728.547||24.35%||Sbicap Trustee Company Limited|
|Amtek Auto Limited||13818||15.26%||Corporation Bank|
|Jyoti Structures Limited||17703.109||17.62%||Sbicap Trustee Company Limited|
|Lanco Infratech Limited||30412.823||4.16%||Ifci Limited|
|Jaypee Infra Limited||41430.75||42.25%||Axis Trustee Services Limited|
|ABG Shipyard Limited||34663.691||5.04%||Indian Overseas Bank|
|Monnest Ispat and Energy Limited||21229.308||11.35%||Sbicap Trustee Company Limited|
|Electrosteel Steels Limited||32582.35||63.22%||State Bank of India|
|Alok Industries Limited||87989.211||21.6%||Sbicap Trustee Company Limited|
|Bhushan Power & Steel Limited||81515.015||18.45%||State Bank of India|
|Bhushan Steel Limited||105210.726||12.08%||Sbicap Trustee Company Limited|
|Essar Steel India Limited||111946.816||36.8%||Axis Trustee Services Limited|
Cumulatively the Bhushan Group alone accounts for roughly 35% of the total NPA of this group.
Electrosteels Steels Limited is an outlier in this list with close to 63.22% of its loan paid. It accounts for a mere 2.58% of the total NPA’s from this group of companies.
This also brings to light the non-quantifiable factor of ‘intent’. As in the case of Lanco Infratech Limited with only 4% of the total loan repaid.
It thus becomes potent to study the companies intent to repay alongside the amount outstanding. Promoter background checks, history, related company analysis and transaction pre and post loan disbursement become necessary.
Watch Out for More
In this article, we have shared a snapshot of 12 large defaulters. In following articles we will cover each defaulter in details and also other large defaulters that significantly contribute to the NPA (Non Performing Assets). ‘The NPA Saga’ will also cover lenders that have suffered the most and their failures to perform proper due – diligence.
This information is collated using Nexensus Tool and Database. To know more or get access reach out to us: