McLeod Russel reports Rs 44 crore consolidated net loss in Dec quarter

McLeod Russel India, the country’s largest bulk tea producer, reported a net loss of Rs 43.58 crore on a consolidated basis in the December quarter. It had reported a net profit of Rs 1.04 crore in the year-ago period.

Sources however pointed out that in the year-ago period, prices in the tea industry were the highest due to supply constraints on account of Covid lockdown. Revenue from operations stood at Rs 388.75 crore in the December quarter compared to Rs 447.54 crore in the same period last year.

Between September and November, the company saw lower crop on account of a dry spell. Plus, there were disruptions on account of proceedings against the company under the Insolvency and Bankruptcy Code (IBC) by a financial creditor. It was later withdrawn and bankers reinitiated the resolution process in terms of the Reserve Bank of India circular dated June 7, 2019.

The Inter-Creditor Agreement (ICA) for arriving at and implementing the resolution plan had been signed by all the lenders (bankers) and the Techno Economic Viability (TEV) study carried out earlier have been revetted and confirmed.

Valuation of tea estates and other assets are currently in process and will be completed in due course of time, the company informed in its notes to results, adding that the lenders have formed a committee for appointment of a credit rating agency for assessing the possible credit rating.

The draft resolution plan prepared by SBI Capital Markets along with their recommendation concerning resolution plan has been modified in terms of ICA and the same will be placed before the bankers for necessary approval after obtaining the final valuation of the assets and credit rating, the company further said.