Mahindra & Mahindra (M&M) stock is buzzing in the trade after it announced that its Korean subsidiary, SsangYong had missed repayments of loans worth Rs 408 crore due on December 14.
The fact that M&M has put out more disclosures about SsangYong was taken well by the street. SsangYong is in trouble and M&M said that SsangYong has outstanding loans of Rs 680 crore out of which they couldn’t make a repayment of Rs 408 crore which was due and payable on December 14 that has lapsed.
M&M has made a commitment to cover the above mentioned loans to the tune of Rs 408 crore and the financial liability of M&M will be limited to the extent not recovered from SsangYong.
This is negative because M&M will have to make that payment but M&M is very cash-rich at the moment. It has over Rs 7,600 crore of cash on the books so there is no problem as far as payment of this liability is concerned.
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(Edited by: By Bivekananda Biswas)
First Published: IST