Banks seek clear picture of Subhiksha’s financials: Report

Banks and other financial institutions, which referred the retail chain Subhiksha to the Corporate Debt Restructuring (CDR) mechanism on January 23, have sought a clear picture of the books of account of the crisis-ridden retail chain, according to a media report.

Subhiksha announced its first quarterly loss and expressed its inability to pay staff salaries and property owners. This is seen as the first instance of a retailer being referred to the CDR mechanism.

The Chennai-headquartered retailer has sought additional funding of Rs 300 crore and a moratorium on interest and principal for two years. Lenders stated that talks are yet to begin, but they will consider increasing the repayment period and convert a part of debt into convertible instruments, the report added.

The company’s gross debt was pegged at Rs 700 crore, nearly times its net worth of Rs260 crore, the report stated.