Company chairman, Partha Chatterjee, who is also the state industries minister, said “We have asked around Rs 100 crore from state's fund and are hopeful to get it. Bankers have denied us further working capital loan and to make sure that the plant is running we have to inject this capital at th earliest.”
After the last board meeting he had pointed out that the board is also mulling to bring in some additional funds through West Bengal Industrialization Development Corporation.
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“After lenders suggestion, we are thinking now to infuse some funds in HPL through WBIDC. WBIDC will have a board meeting to discuss this issue,” he had said.
HPL has been seeking working capital loans worth Rs 1,000 crore from the bankers for quite some time but the bankers have denied to lend further citing multiple issues.
One of the major reasons being the state government not allowing the bankers to turn their debt into equity. SBI and IDBI are the leading of the troubled joint venture between the state government and Purnendu Chatterjee led The Chatterjee Group.
Meanwhile, the West Bengal government, who has been in a hurry to sell off its stake in (HPL) has announced that it will exit from HPL by June.
“My plan is to sell off the states' share by June this year and that time we will get a better valuation of our shares which will help the company. The state government has appointed Delloite India to see through the share valuation of the company which is expected to be done by March 2013.
The Bengal firm is suffering Rs 50-60 crore of cash loss every month and desperately needs non-interest bearing funds to the tune of Rs 1,000 crore. HPL has defaulted on working capital loan.
In March 2012, HPL was in similar situation and was about to be reported to BIFR but the board then had approved conversion of a part of HPL’s loan into equity and that saved the day for HPL. Partha Bhattcahrya was the MD of HPL during that tenure. Currently that post is held by former state transport secretary Sumantra Chowdhury.