The Chatterjee Group (TCG), key promoter in HPL, has filed a special leave petition (SLP) in the Supreme Court, challenging the Calcutta High Court order that barred TCG from filing a petition in the International Court of Arbitration in France. The move by TCG Chairman could spoil the government’s plan to auction its stake in HPL, as per Business Standard.
The West Bengal government has about 40% stake in HPL and has appointed Deloitte India to evaluate the auction process, which was expected to be completed by March 2013. The company’s Board meeting, due on February 1, will be a heated one, as lenders could coerce the promoters to bring more funds or convert some of the debt into equity. The Bengal firm is suffering Rs 50-60 crore of cash loss every month and it desperately needs non-interest bearing funds to the tune of Rs 1,000 crore. HPL has defaulted on its working capital loan.
There may be a high chance of HPL being forced to report to the Board for Industrial and Financial Reconstruction (BIFR). This is because its net worth, according to the latest financial statement, is around Rs 900 crore. HPL’s net worth should be more than Rs 1,200 crore to save it from reporting to BIFR.