Mumbai: L&T Finance and subsidiary L&T Infra Credit jointly sold ₹1,827.5 crore of distressed loans to Avenue Capital-backed Asset Reconstruction Company of India (Arcil) this week, two people aware of the development said. The asset reconstruction company offered ₹1,092.5 crore for the loan portfolio in a 15:85 structure, the people said, where 15% of the consideration was paid upfront, and the remaining in the form of security receipts payable on recovery of the loan.
L&T Finance does not disclose its gross or net non-performing assets to investors in its quarterly results. Its gross stage three (GS3) loans stood at ₹3,591 crore, or 4.02% of total loans, as of end September 2022, the company’s presentation to analysts showed.
GS3 comprises loans due for more than 90 days, as well as other stressed assets. L&T Finance and Arcil did not respond to ET’s request for comment. L&T Finance sold ₹162.3 crore outstanding loans given to Jharkhand Infrastructure Implementation Company for ₹140.5 crore, while L&T Infra Credit sold ₹258.4 crore outstanding loan given to Jharkhand Road Projects Implementation Company for ₹215 crore.
L&T Finance also sold a pool of ₹1,346 crore real estate projects comprising six loans, for ₹702 crore. These include a ₹655.8 crore loan given to Ajnara India, ₹363.7 crore loan to Anand Divine Developers, ₹138.5 crore loan to Almond Infrabuild, ₹120 crore to Prince Foundation, ₹61 crore to Buoyant Technology Constellations and ₹7 crore loan to an individual, Arvind Agarwal.
It also sold ₹60 crore loans given to Distribution Logistics Infrastructure for ₹34.5 crore. Some ARCs had offered to acquire select accounts, but Arcil emerged as the winning bidder because it offered to buy all four pools, said one of the people.
In March 2022, L&T Finance sold ₹3,463 crore distressed loans to
Bank-backed Phoenix ARC. The loans were acquired for ₹1,120 crore under the 15:85 structure. L&T Finance and L&T Infra Credit had invited offers from ARCs earlier this month to sell a portfolio comprising four pools with road assets and real estate loans.
L&T Finance holds a 76.7% stake in L&T Infra Credit, while L&T Finance Holdings has the remaining 23.3% stake.
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