September 28, 2021

The World Stock Markets Tips & Targets, News, Views & Updates

The World Stock Markets Tips & Targets, News, Views & Updates

Srei Infrastructure Finance CEO resigns; co yet to relieve him

Finance chief executive Rakesh Kumar Bhutoria put in his papers but the company has not accepted his resignation so far, people familiar with the matter said.

The non-bank lender has seen about 18% of its workforce from all levels leave after lenders took control of its cash flows in November last year. Srei group has defaulted on its loan repayment following a severe liquidity crunch which the company attributed to the break in cash stream from its borrowers during the pandemic.

About 250 employees left the organisation over the past 10 months, sources close to the development said. Srei Infrastructure and its subsidiary Srei Equipment Finance jointly have around 1,100 employees at present.

“Many executives have left or are leaving, and it is unfortunate. The company, however, is trying to retain them,” a Srei said responding to ET’s queries on the matter. “Nevertheless, as the company’s cash flow continues to remain with the bankers since November 2020, we can only request our employees to stay with us,” it said.

Bhutoria, a chemical engineer from Jadavpur University, had earlier worked with Standard Chartered Bank and IDFC Bank. The reason behind his resignation is however not known. He could not be contacted for comments.

Following the group’s financial ill-health, lenders had put a cap on remuneration of senior management. “Bankers have removed the cap on salaries since April 2021, but the arrears are still due.” Srei said. It has requested lenders to release the amount for paying arrear salaries.

The group has also sought a revised repayment schedule for its dues, estimated to be around Rs 28,000 crore. It has around Rs 18000 crore of bank loan outstanding and another Rs 10,000 crore of external commercial borrowing.

“If the creditors accept our scheme of repayment or propose a modified scheme to the Honorable Tribunal (National Company Law Tribunal), then orderly payments can start immediately. The company remains confident of meeting its liabilities,” it added.

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