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SBI moves to NCLT for insolvency proceedings against Bajaj Hindusthan Sugar

  • India Infoline News Service |
  • 17 Aug, 2022 |
  • 11:57 AM
Following the classification of the company's loans as non-performing assets (NPA) last month, the State Bank of India (SBI) has moved an insolvency petition against Bajaj Hindusthan Sugar.

As per a rating report by CARE Ratings dated December 24, 2021, the sugar manufacturer owes Rs6,090.58 crore to the bank. The company received an NPA tag as a result of a default on loans worth Rs4,814 crore.

Bajaj Hindusthan is one of India’s largest sugar manufacturers, having a strong network of 14 mills across Uttar Pradesh. It has an aggregate sugarcane crushing capacity of 136,000 tonnes crushed per day (TCD) and an alcohol distillation capacity of 800 kilolitres per day (KLD). The company also manufactures ethanol.

Care Ratings downgraded Bajaj Hindusthan's loans worth Rs6,777 crore to 'D,' or default grade, in January 2021, citing the company's delays in debt servicing.

The agency reaffirmed its rating in the December 2021 report, citing the company's poor liquidity position and upcoming debt obligations as a result of significant cane dues.

Last month, FE reported that Bajaj Hindusthan owes cane farmers in Uttar Pradesh Rs2,860 crore for the current season. As of July 5, the company had only paid 35% of its total cane dues of Rs4,398 crore to farmers who supplied cane to the state's 14 mills.

Bajaj Hindusthan Sugar’s counter hit a 52-week low of Rs8.90, against the previous close of Rs10.15 on NSE.

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