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The board of Bharati Shipyard Ltd on Monday agreed to restructure Rs 2,854 crore of its debt.
Earlier the lenders had referred the case to the Corporate Debt Restructuring (CDR) cell.
In a notice to the stock exchanges, the company said the board has noted and discussed the proposal for restructuring of term/working capital debt of Rs 2,854 crore out of a total debt of Rs 3,250 crore.
Bharati Shipayrd's debt had mounted following the takeover of the Mumbai-based offshore service company, Great Offshore, two years ago and the subsequent downturn in the shipping market.
According to reports, lenders, led by State Bank of India, had referred the company to the Corporate Debt Restructuring cell.
The company said it currently, has “order book visibility” worth Rs 6,800 crore to be executed by 2014 and is in advance stages of completion of its two greenfield shipyards at Dabhol and Mangalore.
The floating dock facilities and the equipments that were bought from the British Shipyard, Swan Hunter are in advanced stages of commissioning.
This will enhance the production capacity, which will be used to execute large orders going forward, the statement said.
“Majority of our orders come from the European markets, which is currently facing challenging times. However, we are in the process of delivering five vessels in the next six months.
The debt restructuring will help us to optimise costs and resources in the time to come,” said Mr P.C. Kapoor, Managing Director, Bharati Shipyard Ltd.
In view of the overall sectoral slowdown and the economic challenging scenario in the European countries and the rising cost of capital, the company will undertake various initiatives to optimise the current resources.
“The overall shipping industry in India is under tremendous pressures, however, BSL is confident of its business model and successfully weathering the current business challenges.”
The company share closed at Rs 68.45 on BSE on Monday, up 2.4 per cent from its previous close.
Bharati shipyard had reported a 19.5 per cent drop in net profit at Rs 23.52 crore in the quarter ended September, 2011.
kurup@thehindu.co.in
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