 "Aditya Khaitan")
Khaitan also pointed out that the government had banned a lot of chemicals that will now be allowed to be used.
Amid a clutch of insolvency petitions, Aditya Khaitan, chairman and managing director, McLeod Russel India, expressed hope that the banks will come around and that there will be a resolution to the debt issue.
At the company’s annual general meeting (AGM) on Monday, Khaitan provided an overview of operations and the future roadmap for the company.
Click here to connect with us on WhatsApp
Khaitan told shareholders that he was in constant touch with the banks. “Hopefully, the banks are coming around, and we will be able to resolve these issues. Then the company can chart a clear roadmap for the future in order to come out of its present problems.”
He added, “Once the banks clear the resolution programme, which could be any of the options, we will then get together and focus on what is needed at this hour.”
McLeod Russel had been in debt restructuring talks with banks for a while now. However, some of the lenders and other creditors have filed insolvency petitions against the company.
The annual report for FY24 mentioned applications filed by State Bank of India, Shah Brothers, PDK Impex Pvt Ltd, and IndusInd Bank before the National Company Law Tribunal (NCLT), Kolkata, to initiate the corporate insolvency resolution process (CIRP) were pending and being contested by the company. Subsequent to the closure of FY24, applications for initiating CIRP were also filed by HDFC Bank and Indian Bank, which are being contested by the company.
While disclosing the financial performance for Q1FY25, the company had said that lender banks, as confirmed by the management, were evaluating resolution proposals involving debt repayable to them, including assignment thereof, and necessary communication conveying their decision on the matter was awaited.
McLeod’s principal debt is about Rs 1,800 crore.
At the AGM, Khaitan said that McLeod was looking ahead to a better year (FY25). “There is a crop shortage, and hence we believe that is going to reflect in the prices. The first-quarter results were encouraging. And hopefully, it will continue through the year,” he told shareholders.
Khaitan also pointed out that the government banned a lot of chemicals. “That will level the playing field between the organized and unorganized sector. It will really be the light at the end of the corner for compliant teas and their premium will go up.”
The main problem, he mentioned, was oversupply, which had reflected on prices last year.
On the overseas side, he said Uganda was still suffering. “There is an oversupply of tea in Africa. Exports are also limited because of the oversupply situation in Africa. Also, there were geopolitical issues—especially in Pakistan, Iran, Syria, and Lebanon—either due to sanctions or financial positions. As a result, tea is not being regularly purchased in the manner that it should,” he said, adding that hopefully things will settle down in the coming months.
First Published: Sep 30 2024 | 7:26 PM IST
