Dewan Housing Finance (DHFL) share price fell over 5% in intra day trade today after the firm said it defaulted in interest payment of non-convertible debentures (NCDs) worth Rs 14.13 crore. DHFL share price fell up to 5.05% to Rs 46 against the previous close of Rs 48.45 on the BSE.
However, the stock managed to erase losses and closed marginally higher at Rs 48.60, a rise of 0.31% compared to the previous close.
DHFL share price has lost 92.70% during the last one year and fallen 80.51% since the beginning of this year. An interest payment default of Rs 9.42 crore occurred on secured NCDs (5-year tenure) and of Rs 4.71 crore on 10-year NCDs, the company said.
Separately, DHFL board said it would meet on August 30 to consider the proposal for issuance of equity shares.
"The fund raising can also be through any other permissible mode or a combination there of through issue of prospectus and/or placement document and/or letter of offer and/or any other permissible/requisite offer document, and / or alteration of terms of existing securities of the company, each,"the firm said.
In the beginning of August, Deloitte resigned as the auditor of the cash-strapped firm. DHFL share price fell up to 12.43% to Rs 40.85, its fresh 52-week low compared to the previous close of Rs 46.65 on BSE.
Dewan Housing Finance has seen a series of downgrades by credit ratings agencies sending its share price into tailspin.
On June 6 this year, Icra and Crisil downgraded ratings on Rs 850 crore worth of commercial paper of DHFL to 'default' from 'A4' due to the mortgage lender's deteriorating liquidity condition.
Crisil, in a note, said the downgrade to 'default' or 'D' reflects delays in debt servicing by DHFL on some of its non-convertible debentures (NCDs) because of inadequate liquidity. The payments were due on June 4, 2019. The NCDs are not rated by Crisil.
In a separate note, Icra said, "The rating revision factors in further deterioration in company's liquidity profile and delays in meeting scheduled debt obligation on June 4, 2019."
Icra added that given the stretched liquidity profile and limited visibility on fresh funding, the company is unlikely to be able to service its debt obligation with regard to commercial paper programme in a timely manner. The company has commercial paper (CP) worth Rs 750 crore maturing in June 2019 with the first repayment on June 7.
"With liquidity inadequate as on date to service debt and visibility very low on timely fund raising, we expect the CP to be in default on maturity," Crisil said.
DHFL sits on a debt pile of Rs 90,000 crore and has defaulted on its various repayment obligations in a serial manner
in the recent past.
The company in mid-July posted its biggest-ever quarterly loss of Rs 2,224 crore for the quarter ended March of 2018-19 fiscal compared to a net profit of Rs 134 crore in the corresponding quarter an year ago.
In FY2019, DHFL reported a net loss of Rs 1,036 crore compared to net profit of Rs 1,240 crore in FY2018.
The financial results were delayed due to ongoing concerns. The company is yet to announce the first quarter results of the current financial year.
Edited by Aseem Thapliyal