Financially strained Dewan Housing Finance Corporation (DHFL) plans to repay the overdue liability of around Rs 8,000 crore once the debt resolution process completes.
Addressing the 35th annual general meeting (AGM) of the company, DHFL chairman and managing director Kapil Wadhawan said: "Currently, the company has an overdue liability of around Rs 8,000 crore, which the company will repay once the debt resolution process completes.
"Through the toughest phase your company has been witnessing, it is noteworthy that we have repaid almost 40 percent of our balance sheet without any fresh borrowings. This has been possible only through asset monetisation initiatives. The intent of your company towards fulfilling every financial commitment and obligation remains unimpeachable."
According to Wadhawan, the company continues to take "all necessary steps" to "preserve every stakeholder's interest" and to regain business and grow momentum.
"We have repaid most of DHFL's liabilities until July 5, 2019, despite the liquidity squeeze. We are in discussions with all the lenders and are in advanced stages of finalising the debt resolution plan," Wadhawan said.
"To ensure adequate liquidity to meet the repayments, DHFL also sold its strategic retail assets including Aadhar, Avanse and DHFL Pramerica Asset Managers. As a result, DHFL could repay close to Rs 40,000 crore of its financial obligations," he added.
Wadhawan further said that the company's immediate focus is to resolve the repayment schedule of Rs 8,000 crore of liabilities and restart disbursements.
"This underlines our efforts towards ensuring commitment and complete transparency. DHFL has been reaching out to creditors to participate as investors to provide the much-needed thrust to restart the business," Wadhawan said.
In addition, Wadhawan assured the investors that 'no haircut on the principal' will happen.
"Part of the debt will be converted into equity and will be offered to all permissible classes of creditors. In addition to the conversion of debt to equity, liabilities of the company will be restructured into term loans and non-convertible debentures linked to cash flows from segregated portfolios of the company," Wadhawan said.
"Further details such as ROI and deferred payment schedule will be released by the company soon and all repayments under the plan will be significantly higher than the liquidation value," he added.
DHFL has been one of the companies most severely hit by the ongoing liquidity crisis which came to light after the infrastructure lending major IL&FS first defaulted on its commercial papers last year.
The housing lender's gross non-performing assets (NPAs or bad loans) as on March 31, 2019, rose to 2.74 percent, as against 0.96 percent during the like period of the previous fiscal.
Besides, DHFL had said on July 13 that it had defaulted on interest payments to the tune of Rs 48 crore on non-convertible debentures (NCDs) which were due on July 6 and 8.In its quarterly earnings for the January-March quarter announced last month, the company reported a net loss of Rs 2,223 crore.