Reliance Power Limited has announced key leadership changes amidst an ongoing Enforcement Directorate (ED) investigation into suspected loan frauds involving associated companies.

New Appointments

In a board meeting held on October 11, Reliance Power made the following appointments:

• Shri Arup Ashok Gupta has been appointed as a Non-Executive and Non-Independent Director. Gupta brings over 40 years of HR experience and has been with the Reliance Group for 16 years.

• Shri Neeraj Parakh, currently serving as Executive Director and CEO, has been given additional charge as interim Chief Financial Officer. Parakh has 29 years of professional experience, including more than 20 years with Reliance, and has been instrumental in delivering power generation projects totaling over 10 GW with capital expenditure of ₹50,000.00 crore.

Ongoing ED Investigation

These appointments come in the wake of the ED's investigation into suspected loan frauds involving Reliance Home Finance Ltd. (RHFL) and Reliance Commercial Finance Ltd. (RCFL). The probe centers on loans totaling ₹12,524.00 crore, of which ₹6,931.00 crore have been classified as non-performing assets (NPAs).

Key Findings of the Investigation:

• Preliminary findings suggest potential circular lending practices, with funds being routed back to other Reliance group companies.
• Rana Kapoor, associated with Yes Bank, allegedly played a significant role in sanctioning these loans.
• Companies linked to Kapoor's family also received credit facilities.
• A Grant Thornton audit identified significant fund diversion and violations of lending policies.

The ED has conducted extensive searches across 60 companies and 22 individuals as part of this wide-ranging investigation.

Corporate Developments

Reliance Power has also reported recent corporate activities:

1. Outstanding debt securities worth ₹250.00 crore, issued on July 10, 2017, with a maturity date of June 30, 2035, and an 8.00% coupon rate.

2. An application for reclassification of Reliance Capital Limited to the public category, following IndusInd International Holdings Limited's implementation of a resolution plan under the Insolvency and Bankruptcy Code, 2016.

As the investigation continues and the company undergoes leadership changes, stakeholders will be closely monitoring further developments in this case.

Reliance Power Limited (RPL) has taken a significant step in its corporate restructuring by filing applications with the Bombay Stock Exchange (BSE) and National Stock Exchange (NSE) for the reclassification of Reliance Capital Limited to the public category. This move comes in the wake of a resolution plan implemented by IndusInd International Holdings Limited under the Insolvency and Bankruptcy Code.

Key Developments

• Application Filing: RPL has submitted applications to both BSE and NSE seeking their no objection for the reclassification process.
• Board Approval: The company's Board of Directors has approved the application, deeming it compliant with applicable listing regulations.
• Resolution Plan: The reclassification is a consequence of IndusInd International Holdings Limited implementing a resolution plan under the Insolvency and Bankruptcy Code, 2016.

Timeline of Events

Implications

The reclassification, if approved, could potentially alter the shareholding structure of Reliance Power Limited. This move is part of the broader changes following the implementation of the resolution plan by IndusInd International Holdings Limited.

Investors and market watchers will be keenly observing the responses from BSE and NSE regarding this reclassification request. The outcome could have implications for the company's ownership structure and potentially its governance framework.

As the situation develops, stakeholders are advised to stay tuned for further updates from the company and regulatory bodies. The reclassification process, subject to necessary approvals, marks a significant corporate action for Reliance Power Limited in its ongoing restructuring efforts.