Sadbhav Engineering Limited has successfully completed the implementation of its debt restructuring plan worth ₹1,516.71 crores. The company announced that Punjab National Bank, acting as the lead bank, confirmed the implementation of the restructuring plan on March 31, 2026, following consortium approval from majority lenders representing 77.83% by value and 60% by number.

Restructuring Plan Implementation

The restructuring plan has been implemented in accordance with the Reserve Bank of India (Commercial Banks- Resolution of Stressed Assets) Directions, 2025. The confirmation came through Punjab National Bank's letter dated April 1, 2026, which was based on the consortium meeting held on March 30, 2026. The implementation marks the successful completion of the Master Restructuring Agreement (MRA) that was originally executed on March 25, 2026.

Financial Structure and Debt Composition

The restructuring plan covers total debt aggregating to ₹1,516.71 crores, with a specific breakdown of exposure types. The fund-based exposure of ₹906.35 crores will be restructured as non-convertible debentures, providing a structured approach to debt management and repayment.

Consortium Lenders and Agreement Structure

The MRA has been executed with IDBI Trusteeship Services Limited acting as security trustee and debenture trustee, along with six major lending institutions including Punjab National Bank, Union Bank of India, Axis Bank Limited, Assets Care & Reconstruction Enterprise Limited, Bank of India, and Yes Bank Limited.

Regulatory Compliance and Trading Window

The company has informed both BSE Limited and National Stock Exchange of India Limited about the restructuring plan implementation through a regulatory filing dated April 1, 2026. The filing was made pursuant to Regulation 30 of SEBI (LODR) Regulations, 2015. Due to the price-sensitive nature of this information, the company has confirmed that the trading window remains closed effective April 1, 2026, as previously communicated on March 31, 2026.

Historical Context and Strategic Impact

The successful implementation represents the culmination of a comprehensive debt restructuring process that addresses financial obligations spanning over a decade. The restructuring encompasses various underlying loan agreements dating back to the original loan agreement from March 18, 2008, and multiple supplemental working capital consortium agreements from 2010, 2011, 2016, 2018, and 2021. This structured approach provides the company with a clear path for financial recovery while maintaining operational continuity.

Sadbhav Engineering Limited has successfully allotted non-convertible debentures (NCDs) worth ₹713.25 crore to its existing lenders as part of a comprehensive debt restructuring initiative. The Finance and Investment Committee of the company approved this allotment during their meeting held on March 25, 2026.

Debenture Allotment Details

The debenture issuance comprises two distinct tranches, both issued on a private placement basis to existing lenders. The securities are unlisted, secured, taxable, and redeemable non-convertible debentures with a face value of ₹1,00,000 each.

Interest and Repayment Structure

The NCD-I tranche carries an interest rate of 9% per annum, payable along with principal repayment on respective redemption dates. The repayment follows a structured schedule with the largest portion (45.00%) due in September 2026, followed by graduated payments through March 2031.

NCD-I Repayment Schedule:

The NCD-II tranche features a significantly lower interest rate of 0.01% per annum, with an additional provision where 8.99% per annum will be converted into equity shares subject to regulatory guidelines. This tranche has an extended maturity period until March 2034 with a different amortization schedule.

Security and Regulatory Compliance

Both debenture tranches are secured through hypothecation of current and other movable assets (excluding assets exclusively charged to existing lenders) and mortgage of identified fixed assets. The debentures will be held in dematerialized form and are not proposed for listing on any stock exchange.

The allotment has been made in compliance with Regulation 30 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015. The company has indicated that redemption will be made out of the company's cash flows, with penal charges applicable in case of default.

Source: None/Company/INE226H01026/fc969471-d929-4864-b44a-d4d248ae8b27.pdf