Value of Jaypee assets more than its dues, says bank plea at tribunal
The value of assets pledged by Jaypee Infratech with lenders is much higher than the company’s outstanding loans, according to an application filed by IDBI Bank before the National Company Law Tribunal.
However, the company had failed to speed up construction of its projects and loan repayments, as it could not sell the assets due to market conditions, it said. The company has delayed the construction of around 25,000 flats and is going through the insolvency process at the behest of IDBI Bank.
Resolution of the insolvency process will ensure that while homebuyers get their flats, the bank loan is restructured by extending the repayment period as per the expected cash flow. This would help speed up construction of the houses as more money would be available, a banker said.
According to IDBI Bank’s application before NCLT, the market value of the pledged assets is estimated at Rs 17,116 crore. The distress value of the assets, on the other hand, is estimated to be Rs 14,548 crore. As against this, the total outstanding of the banks is around Rs 9,000 crore. Besides this, the banker, who is familiar with the development and the company, said total assets of the company, as per the assessments of the bank, were valued at Rs 33,000 crore.
According to the application, the company had defaulted to the tune of Rs 50 crore in principal as on June 15, 2017. In addition, the application said, the default amount towards overdue interest, including liquidated damages as default interest, aggregated to Rs 476 crore.
In fact, the suspended management of the company under Manoj Gaur had offered banks to take land as one-time settlement against the loans, which the banks had agreed to in March 2017, but later decided against it.
According to a company source, the shortfall in funds to complete the construction of all flats in Wish Town and Aman is around Rs 1,500 crore. He said the company would generate the required funds by selling unsold housing units and commercial space. Also, the management would not hesitate to sell the land holding of the company, if needed, he added.
Jaypee Infra would give possession to 600 homebuyers in Jaypee Green Aman on August 26. The company has received occupation certificate from Noida Authority for five towers in Aman. As it doesn’t owe anything to the Noida Authority with regards to Wish Town and Aman, buyers can get the registry done.
Jaypee Greens will also offer possession to 200 more buyers in different towers of Kosmos and Klassic. A senior company official said a further 500 units would be ready for possession in the next 60 days. The process of handover was likely to be further expedited, the source said.