NEW DELHI: A group of lenders is steadily invoking pledged shares in Coffee Day Enterprises Ltd (CDEL) in a bid to make up for the losses incurred due to the fall in stock prices following promoter V G Siddhartha’s demise.
According to the latest data available on the stock market, finance companies such as Edelweiss and IndusInd Bank have invoked 5.2 per cent of the pledged shares of the promoters between August 1 and August 27.
Edelweiss has invoked 87.39 lakh shares, followed by IndusInd Bank with 23.32 lakh shares that were held by Gonibedu Coffee Estates, one of the holding companies of the promoter which has 5.24 per cent shares in CDEL and its pledged share amount to 78.94 per cent.
Siddhartha’s personal holdings, in addition, have also been invoked by institutions such as Kotak Mahindra Bank, Aditya Birla Money and IDBI Bank “in connection with the borrowings within the group companies of CDEL.”
As on March 31, 2019 CDEL reported a debt of Rs 6,547 crore. Apart from Gonibedu, other promoter companies — Devadarshini Info Technologies, Coffee Day Consolidations, and Sivan Securities — had a combined shareholding of 17.13 per cent in CDEL.
These firms had raised funds by mortgaging shares held in the listed firm CDEL between 2014 and 2019, of which Coffee Day Consolidations Pvt raised the maximum Rs 1,533.57 crore followed by Devadarshini Info Technologies’ Rs 1,171 crore.
While Devadarshini Info Tech holds 5.87 per cent shares in CDEL, and pledged shares on various loans and mortgages amounting to 83.08 per cent of its holding, Sivan has pledged 99.9 per cent shares and its holding in CDEL is at 0.21 per cent. Similarly, Coffee Day Consolidations has 5.81 per cent shareholding in CDEL.
No timely repayments Coffee Day has not made repayments on time and has appealed to its lenders and creditors to give it sufficient time to honour its repayment obligations