Deccan Chronicle Holdings (DCHL) shares hit a record low on Monday, falling near 10 per cent on the bourses amid reports that the company, which owns Deccan Chronicle newspaper, is facing severe financial crisis.
After opening weak, the company's scrip plummeted 9.97 per cent to a record low of Rs 16.70 on the Bombay Stock Exchange (BSE). Similarly, the stock ended 9.97 per cent lower on the National Stock Exchange, at Rs 16.70.
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According to reports, Industrial Finance Corporation of India Ltd (IFCI) filed a petition against DCHL in the Andhra Pradesh High Court on Friday after the media company defaulted on redemption of 250 unsecured redeemable non-convertible debentures (NCDs) on June 26.
They were part of the Rs 150 crore NCD issue made by way of private placement by DCHL with Infrastructure Development Finance Company (IDFC) last year at an interest rate of 11.25 per cent per annum for a tenure of 364 days.
In July last year, 250 of these NCDs were acquired by IFCI from IDFC.
DCHL also failed to pay up its dues of Rs 27.80 crore despite repeated requests and demands, the report said.
Contending that DCHL is unable to discharge debts of its creditors and may become insolvent, IFCI urged the High Court to order winding up of the company under the relevant sections of the Companies Act, 1956.
Also on Friday, promoters of cash-strapped DCHL pledged 54 per cent of their stake with Future Capital Holdings.
The shares were pledged as a part of collateral encumbrance created in consideration of borrowings by Deccan Chronicle Holdings Ltd and Aviotech Private Ltd.
The DCHL scrip, which was offered at a premium of Rs 152 on a face value of Rs 10 during its initial public offer in December 2004, currently has a face value of Rs 2 after being split in January 2007.
With inputs from PTI