Gayatri Projects Limited (GPL), a prominent infrastructure company, has successfully navigated its way out of the Corporate Insolvency Resolution Process (CIRP) and is now gearing up for a significant financial restructuring. The company's exit from insolvency and its subsequent plans have set the stage for a potential turnaround in its fortunes.

Insolvency Process Concluded

On September 10, the National Company Law Tribunal (NCLT) allowed creditors to withdraw their CIRP application against Gayatri Projects. This decision came after the company's promoters submitted a debt resolution proposal that was accepted by both the Resolution Professional and the Committee of Creditors.

Debt Repayment Terms

Under the terms of the resolution, Gayatri Projects is now obligated to repay all creditor debts within a 90-day timeframe. This swift repayment schedule underscores the company's commitment to honoring its financial obligations and restoring its financial health.

Fundraising Initiative

To meet this substantial financial commitment, Gayatri Projects has announced plans to raise funds. The company has scheduled a crucial board meeting for September 25 to deliberate on various fundraising options. This meeting is expected to chart the course for the company's financial strategy in the coming months.

Implications of Debt Resolution

T.V. Sandeep Kumar Reddy, Chairman and Managing Director of Gayatri Projects, stated in a regulatory filing, "Subsequent to repayment/giving effect to the resolution proposal, the company would be free from Fund based limits." This indicates that once the debt repayment is completed, Gayatri Projects will have greater financial flexibility, potentially opening up new avenues for growth and expansion.

Looking Ahead

The successful exit from the insolvency process and the planned debt repayment mark a significant milestone for Gayatri Projects. As the company works towards fulfilling its financial obligations, stakeholders will be keenly watching how it navigates this critical phase and positions itself for future opportunities in the infrastructure sector.

The coming weeks will be crucial for Gayatri Projects as it finalizes its fundraising strategy and works towards meeting the 90-day debt repayment deadline. The outcome of these efforts could have far-reaching implications for the company's future trajectory in the competitive infrastructure industry.

The National Company Law Tribunal (NCLT) in Hyderabad has given its approval to a significant one-time settlement plan for Gayatri Projects, marking a crucial development in the company's financial restructuring efforts.

Settlement Details

• The NCLT's Hyderabad bench has approved a ₹2,400 crore one-time settlement plan proposed by Gayatri Projects' promoters.
• This plan aims to resolve ₹8,100 crore in dues owed to lenders, led by Canara Bank.
• The promoters, including T Subbarami Reddy and his family, will be responsible for paying ₹750 crore in fund-based exposure and covering bank guarantee invocations.

Key Components of the Settlement

Timeline and Lender Approval

• The promoters have been given a 90-day window to complete the payments.
• 97% of lenders voted in favor of this settlement plan.

Current Progress

• Promoters have already deposited ₹115 crore as part of the settlement.
• The remaining payments are expected to be made through asset monetization and funds from investors.
• Seven out of 13 collateral properties will be released for sale to facilitate the settlement.

Recovery for Lenders

• This settlement represents a 30% recovery for the lenders.
• The resolution process has spanned three years.
• Previous attempts to find a buyer for the company had failed, leading to this settlement approach.

Implications

The approval of this settlement plan by the NCLT marks a significant step for Gayatri Projects in addressing its financial obligations. It provides a structured approach to resolving the company's substantial dues, offering a path forward for both the company and its lenders. The successful implementation of this plan could potentially stabilize the company's financial position and pave the way for its future operations.

As the 90-day payment window progresses, stakeholders will be closely monitoring the execution of this settlement plan, which could have broader implications for the infrastructure sector and debt resolution processes in India.