There's finally some progress for those who have invested in Jaypee projects, but have yet not received the possession of their flats, plots. The National Company Law Tribunal (NCLT) has appointed an insolvency professional who will look into the claims of such buyers, according to the Times of India. Flat buyers can make their claims till August 24 as two weeks have been provided for the purpose.
The projects that have not yet been completed include Jaypee's 800-acre Wish Town in Noida's Sector 128. The Wish Town has 32,000 apartments, out of which only 5,500 have been delivered. Jaypee has assured it would complete the project in the coming years.
Bankers, led by IDBI Bank, had taken Jaypee Infratech to the NCLT for bankruptcy proceedings. The company is developing the Yamuna Expressway project between Noida and Agra with township area totalling 25 million square metres.
On August 9, the National Company Law Tribunal admitted the insolvency petition filed by IDBI Bank against debt-ridden Jaypee Infratech. "Consequent upon withdrawal of objections filed by the company, NCLT, Allahabad Bench has on August 9 pronounced operating portion of its order admitting the petition of IDBI Bank Ltd filed under Section 7 of Insolvency and Bankruptcy Code 2016 and appointing Interim Resolution Professional," Jaypee Infratech said in a regulatory filing.
Over the last three years, the company has been on an overdrive to sell assets - hydropower projects in Himachal Pradesh to Sajjan Jindal's JSW and cement units to Orient Cement and A.V. Birla's Ultratech. "We have always worked closely with banks. We pested and reduced liabilities according to their advice," says an executive, on condition of anonymity.
Bankers say the value of the company's assets is far more than its debt. "But the value may take a long to mature and, hence, there is a liquidity mismatch," says a banker.
There is also a view that the banks may take equity as promoters still hold a 72 per cent stake. The market capitalisation of the company is Rs 3,000 crore. But some banks might not be receptive to the idea. "Why should a bank move from a secured position to equity?" says a banker.