The Hyderabad bench of the National Company Law Tribunal (NCLT) has initiated insolvency proceedings against Gayatri Projects after it admitted a plea filed by State Bank of India (SBI) in the matter.
On November 15, 2022, a two-judge bench of VR Badarinath Nandula and S Ranjan Prasad admitted SBI’s plea as banks intensify pressure to recover pending dues exceeding Rs 6,000 crore.
SBI is the third lender which has filed a petition against the debt-laden engineering, procurement and construction (EPC) company. Petitions of Bank of Baroda and Canara Bank against Gayatri Projects is pending with the NCLT. Recall here that insolvency law makes it mandatory for tribunals to admit the application of financial creditor within 14 days.
All these banks are part of a nine-member consortium to whom Gayatri Projects owes huge amounts in debt. Other banks to which the embattled company owes money include Federal Bank, Punjab National Bank, Union Bank of India, Bank of Maharashtra and Indian Overseas Bank.
Hyderabad-based Gayatri Projects is the flagship company of the Gayatri Group that has interests in infrastructure, power, hospitality, real estate and industry. Promoted by former Rajya Sabha member and movie producer T Subbarami Reddy, the company was established in 1963 as a partnership firm specialising in irrigation construction projects.
Trouble for the company stared in 2015 when a restructuring plan failed to salvage the situation, resulting in loan defaults, ultimately culminating in Gayatri Projects dues qualified as non-performing assets.
Meanwhile, the market cap of the company is regularly declining. Gayatri Projects reported net loss of Rs 268.33 crore in the quarter ended September 2022 as against net loss of Rs 189.41 crore during the same quarter last year. Sales declined 63.46% to Rs 316.25 crore in the quarter ended September 2022 as against Rs 865.53 crore during the same quarter last year.
An alumna of the Indian Institute of Mass Communication, Dhenkanal, Sunita Mishra brings over 16 years of expertise to the fields of legal matters, financial insights, and property market trends. Recognised for her ability to elucidate complex topics, her articles serve as a go-to resource for home buyers navigating intricate subjects. Through her extensive career, she has been associated with esteemed organisations like the Financial Express, Hindustan Times, Network18, All India Radio, and Business Standard.
In addition to her professional accomplishments, Sunita holds an MA degree in Sanskrit, with a specialisation in Indian Philosophy, from Delhi University. Outside of her work schedule, she likes to unwind by practising Yoga, and pursues her passion for travel.
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