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DHFL shares rise 4% as resolution process underway

Shares of Dewan Housing Finance Corp climbed over 4 per cent in Friday's trade after the company in an update to stock exchanges said it is working towards resolving its liquidity crisis in a comprehensive and timely manner, even as it may fail to meet its immediate payment obligations.

twitter-logo Reuters        Last Updated: August 9, 2019  | 12:35 IST
DHFL shares rise 4% as resolution process underway
The scrip jumped 4.41 per cent to hit a high of Rs 49.70 on BSE.

Shares of Dewan Housing Finance Corp climbed over 4 per cent in Friday's trade after the company in an update to stock exchanges said it is working towards resolving its liquidity crisis in a comprehensive and timely manner, even as it may fail to meet its immediate payment obligations.

The NBFC said it has formulated and submitted a draft resolution plan to the lenders. While most of the lenders have executed the ICA, one of the debenture-trustees, namely, Catalyst Trusteeship Services, is undertaking the process of seeking consent from the debenture holders to be a party to the ICA, the company told BSE.

The scrip jumped 4.41 per cent to hit a high of Rs 49.70 on BSE.

Given the ongoing discussions on the resolution plan with the lenders who have signed the ICA, the company believes that its payment obligations falling due in the immediate future, may not be met as per their existing schedule," the company told BSE.

The NBFC has paid over Rs 41,000 crore towards discharging its financial obligations even as it has been facing a liquidity crisis since September 2018.

"This has been without recourse to any significant funding to the company _ a situation exacerbated by multiple rating downgrades. The company has met its financial obligations during this period mainly through a combination of securitisation of assets and repayment collections. The company has been, and is working towards resolving its liquidity crisis," it said.

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