Srei Infrastructure Finance (Srei) on Saturday reported a consolidated loss of Rs 971.05 crore in the quarter ended in June 2021 due to the impact of the COVID-19 pandemic that caused liquidity mismatch.
It had posted a net profit of Rs 23 crore in the same quarter a year ago ended on June 30, 2020.
Sequentially, the loss narrowed from Rs 3,555.19 crore in the quarter ended in March 2021.
Owing to the pandemic and its more virulent second wave followed by lockdown extended, the collection of wholly-owned subsidiary SEFL (Srei Equipment Finance) from the borrowers and the lessees were severely impacted.
It also adversely affected the cash flows of SEFL and has resulted in the liquidity mismatch, the company said in a regulatory filing.
"There is still huge uncertainty around Covid-19 pandemic and the extent to which the pandemic may further impact the Group's operational, financial results and asset quality will depend on future developments, which are still unascertainable at this points in time," it added.
Total income of the company during April-June 2021-22 fell sharply to Rs 793.34 crore from Rs 1,228.88 crore in same period of 2020-21. However, it was up from Rs 594 crore in March quarter.
During 2019-20, the board of directors of Srei and SEFL had approved to transfer the lending, interest earning and lease businesses of the parent company to SEFL.
Subsequently, SEFL filed applications before Kolkata bench of NCLT proposing Schemes of Arrangement with all its secured and unsecured lenders (creditors).
The NCLT passed interim orders on October 21, 2020, and December 30, 2020, stating that creditors, as per the Schemes, shall maintain status quo till further orders with respect to their contractual terms, dues claims and rights.
Also, the creditors and all governmental and regulatory authorities are stopped from taking any coercive steps including reporting in any form and/or changing the account status of SEFL and the parent company Srei from being a standard asset.
With respect to payment to lenders, Srei said while SEFL had to offer repayment moratorium/resolution plan to its borrowers/lessees, on other hand SEFL was not allowed any relief from its lenders.
"This resulted in huge mismatch in its cash flows. SEFL, then filed Schemes of Arrangement with NCLT. The matters covered in the scheme are pending for final decisions before NCLT/NCLAT," it said further.
