188 Crisil Rated Companies, incl 3i Infotech Default On Loans
17 April 2012 Mumbai: Slowing Growth And The High Interest Rates Have Taken A Toll On Many Medium-Sized Companies. About 188 Companies Listed By Crisil Failed To Service The Interest On Loans Or The Repayment Of The Principal On Time. More Than A Dozen Of Them Are Listed.
Among The Companies Listed That Does Not Have To Stick To Their Timetable For Repayment In 2011-2012 Are Raj Agro Mills, Mawana Sugars, Indosolar Ltd. , ARSS Infrastructure, Simbhaoli Sugar, Shree Industries Of Eastern Silk, 3i Infotech, Vimta Labs, SR Industries, Mangalam Drugs, Surya Pharmaceuticals And CCS Infotech. Most Of Them Could Not Repay The Funds Of The Order Of 50 To 300 Crore Rupees, Said Sources In The Financial Market. Large Microfinance Society Spandana Sphoorty And Asmitha Micro Finance Also Unsuccessful To Meet Up Their Promises Of Rebate Last Year.These Companies Listed By The Largest Agency Crisil, The India Notation, Have A Combined Debt Outstanding Of 20,000 Rupees.
They Did Not Respond To E-Mail Requests For And More Than 90% Of These Borrowers Have Sides In"BB"(Double ' B') Or Under Categories;" "Most Of Them Have Borrowed Money From The Banks," Said Pawan Agrawal, Director, Crisil Rating.According To The Findings Of Crisil, Default Rate - The Ratio Between The Number Of Companies That Failed The Total Number Of Companies Under The Supervision Of The Agency - Fell From 3.4% In 2011-2012 To 2.9% In 2010-2011.
Low Profitability, Liquidity And Demand Decline Is Triggering By Default, Said Agrawal. "Access To Financing And More Borrowing Costs Are Turning Off A Challenge For Businesses.". "In Respect To Credit Quality Prospects, Expect Us Downgrades Continue To Outnumber Upgrades For Certain Neighborhoods," Said.With A Large Debt On Their Books, Companies Experience Difficulties In Fulfilling Their Financial Commitments, Merchant Bankers Said. Those Who Have A Substantial Debt On Their Balance Sheets Are Affected By Increased Interest Losses Marked The Market And Costs On Derivatives And Foreign Currency Due To The Depreciation Of The Rupee Debt.
This Resulted In A Significant Decrease In Net Margins Of Most Companies Since September 2011.Medium-Sized Enterprises At The Side Are That It Is Difficult To Raise Working Capital Funds;" Lenders Not To Invest In The Show Small Businesses, Fearing Defaults. "Even Higher Are Bringing Not," Said a Lead Arranger of Debt Based in Mumbai to Small - And Medium-Sized business. According To Analysts, Sectors Such As The Textile, Real Estate, Steel, Automotive, Construction And Engineering And Infrastructure Will Carry On To Facade Margin Heaviness In The Future Quarters. Cash-Strapped Company Are Trying To Postpone Or To Refinance Their Debt.
Companies By Default Try To Redefine Their Payment Schedules." Transfers Are Occurring At Rates As High As 18-20%. "Most Companies Are Rolling On Their Debt For Three Months," Said The Arranger Of Debt. With The Policy Of Meeting The Corner Turn RBI, Proponents Hope For A Reduction In Rates And The Easing Of Liquidity To Mid-May. They Also Expect A Rally In The Stock Market, Which Will Help To Raise Funds By Issuing Shares To Private Investors. Default Rate Is A Reflection Of Lower Risk Management Capabilities Of The India." "Outside Factors Regular As productivity And Low charge, Only Good supremacy And Strong Risk organization Skills Invites Companies To Meet Their Financial Obligations," Said Shailesh Haribhakti, President, BDO Consulting.
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