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NEW DELHI | WEDNESDAY, 8 APRIL 2020 COMPANIES 3 <

Dip in valuation prompts Uttam Galva defaults on ~664-cr loan

ArcelorMittal, SBI

IT firms to bet on buyouts

But the Supreme Court later
asked ArcelorMittal to clear the
among steel dues of UGSL if it wanted to
become eligible to bid for Essar
firm’s creditors Steel. Despite the takeover of
loans, UGSL’s financial per-
Tech firms with niche DEV CHATTERJEE
Mumbai, 7 April
formance did not improve due
to the economic slowdown and
capabilities are on The coronavirus (Covid-19) pan-
it consistently reported lower
revenue and higher losses. For
the radar of IT biggies demic and the resultant shut- the quarter ended December
down have started impacting 2019, it reported revenues of
DEBASIS MOHAPATRA companies with Uttam Galva ~147 crore and loss of ~273 crore.
Bengaluru, 7 April Steels (UGSL) defaulting on In fiscal year 2019, its revenues
~664-crore loan. Apart from were ~556 crore with a massive

W
ith valuations coming to a realis- state-owned banks, Arcelor- loss of ~2,126 crore.
tic level because of the coron- Mittal is one of the top creditors LOCKDOWN BLUES Thanks to ArcelorMittal’s
avirus disease (Covid-19), many of the company. Uttam Cash flows ArcelorMittal Lenders payment, the State Bank of
IT services firms with sound balance sheets UGSL, which shut its plants Galva owes disrupted had taken staring at India (SBI), which had filed an
have started exploring the possibility of and operations after the lock- ~1,008 cr to due to over Uttam huge losses insolvency petition against
acquiring companies operating in down was announced last its creditors lockdown, Galva Steel’s in case UGSL, had withdrawn the peti-
niche areas. According to sources in the month, said it has an outstand- as on March economic loans to bid operations do tion on November 1, 2018 – giv-
know, strategy teams of many IT firms beanet-gainerinthemediumtolongterm,” ing of ~1,008 crore to its credi- ing it a new lease of life.
have sounded out investment bankers and TECHNOLOGY SERVICES DEALS Avendus Capital said. No wonder, compa- tors. A company source said the
2020 slowdown for Essar Steel not improve
In its annual report for fiscal
analysts about opportunities that could be CLOSED IN MARCH 2020 nies such as Accenture, Infosys, Capgemini, default is “technical in nature” year 2019, UGSL warned that
the right fit before conducting any formal Cognizant have closed acquisitions in and blamed the ongoing lock- it after a long-drawn legal battle. sector banks as ‘surviving debt’. cash flows from its existing
due diligence.
Company Acquisition March, despite the crisis. down for it. Operations had to The loans were taken over Similarly, external commer- operations are not sufficient to
Analysts are saying that with enough Accenture ESR Labs In the past few years, most top and mid- be shut after it was unable to by ArcelorMittal India Private cial borrowing (ECB) loan facil- cover the fixed overheads let
cashreservesathand,mostITfirmsarebet- Context Information tier IT services firms, including Infosys, procure raw materials from sup- Limited (AMIPL), which had ities were partly assigned to Citi alone the principal and interest
ter placed to overcome the Covid-19 crisis. Security Wipro,HCLTech,andTechMahindra,have pliers due to the lockdown, said paid off ~4,922 crore to the Bank, London branch, and $136 obligations.
However,asrevenuegrowthislikelytotake completed many acquisitions to build company sources. secured financial lenders of million was paid by “However, to ensure that the
a hit, a good acquisition could offset some Infosys Simplus capabilities apart from supplementing rev- State Bank of India, Oriental UGSL to clear the overdue prin- ArcelorMittal, Luxemburg. outstanding debt does not
losses in top line. “Global flight of capital to Cognizant Lev enue growth. “When the industry is likelyto Bank of Commerce, Indian cipal amount as on September The ownership of Uttam become a non-performing
safety in a strengthening dollar environ- see a revenue growth in the range of -5 to +5 Overseas Bank and Vijaya Bank 30, 2018, and interest due as on Galva stayed with the Miglani asset, the company has consis-
ment would generally make investment in Capgemini WhiteSky Labs [per cent] in 2020, a good acquisition can in also have exposure to the com- October 17, 2018. family, which had acquired tently cleared dues before 90
IT, KPO (knowledge process outsourcing) Starhub Strateg many ways offset losses from core business. pany. A large part of Uttam Later, the overdue principal ArcelorMittal’s 29 per cent stake days of the due date from funds
and BPM (business process management) * Source: Avendus Capital At a time, when valuations are attractive, Galva’s loans was taken over by paidwasassignedtoAMIPLand in Uttam Galva for ~1 on borrowed from ArcelorMittal
firms an even more attractive proposition,” many IT firms have started exploring this ArcelorMittal frompublic sector the remaining outstanding loan February 7, 2018 – just before India Private Limited by way of
wrote Amit Singh, executive director (Ent- February and 89 in March, the note said. option,” said Pareekh Jain, an IT outsourc- banks after it made the bid for (till completion of its tenure) ArcelorMittal had made the bid inter-corporatedeposits(ICDs),”
erprise Technology & Services) of Avendus However, deals in technology services ing advisor & founder of Pareekh Con- EssarSteelin2018andlaterwon continued with existing public for Essar Steel. it had said.
Capital, in a recent note to investors. space were not impacted as much as the sulting. While large-cap IT stocks have fall-
According to investment banking firm, overall technology segment. M&As in the en by 27 per cent in March from their
mergers and acquisitions (M&A) activity in segment stood at 14 in January, rising to 28 five-year high globally, market cap of mid-
the sector was trending down in March
because of the unexpected disruption.
in February, and was 17 in March.
“While the current unprecedented situ-
cap IT firms have dipped by 48 per cent. Wipro to announce Q4, Debt-laden DHFL says won’t
While deals announced in the space stood
at 226 in January, the number fell to 191 in
ation has shaken investor confidence, we
expect technology outsourcing industry to
SI 1
IT catches Covid bug: Sector’s outlook takes a hit8 >
FY20 results on April 15 pay lenders, bondholders
IT major Wipro on Tuesday solidated financial results of Dewan Housing Finance Corp- DHFL said all the rated debt
said it will announce its fourth the Company under IndAS for oration (DHFL) on Tuesday said papers of the company are
quarter and FY20 results on the quarter and year ended it will not make any interest or carrying default grade ratings

E-com firms ask govt to provide April 15.

There are speculations
that announcement of corpo-
March 31, 2020,” Wipro said
in a regulatory filing.
It added that the Board
principal payment to lenders
as well as bond holders as the
company is under resolution
and disclosures on the same
have been made to the
exchanges.

curfewpassesvalidfor6months
rate earnings for March quar- will also look at recommen- process. The creditors of the
ter could be delayed given the dation of final dividend, if The Corporate Insolvency company were duly informed
ongoing lockdown amid any, for the financial year Resolution Process (CIRP) was about commencement of the
Covid-19 outbreak. ended March 31, 2020 at the initiated against the debt- CIRP and were requested to
PEERZADA ABRAR Delhi,” said a person. “...meeting of the Board of meeting. ridden company as per the submit their claims to the
Bengaluru, 7 April “If the fulfilment centre is located in Directors will be held on April The results will be provisions of the Insolvency company in the prescribed
North Delhi, the associate could be liv- 15, 2020, inter alia, to consider announced after stock mar- and Bankruptcy Code, 2016 manner as per the provisions of
E-commerce companies such as Amazon, ing in South Delhi. Then he has to go all and approve the condensed ket trading hours in India, with effect from December 3, the Code.
Flipkart, Bigbasket as well as Grofers and the way from his home to the fulfilment audited standalone and con- Wipro said. PTI 2019. PTI
the seller communities are in talks with centre to pick up the stuff for delivery.
the government for curfew passes valid Many delivery associates have been
for four-six months. They have also stopped by the police, saying that they
sought an approval to put IT products don’t have valid passes.”
required by consumers in the essential According to industry insiders, more
items’ list, according to sources. than groceries, the biggest challenge for
The time period of 4-6 months would consumers is to get various important
give enough visibility and time for the electronic items such as phones, com-
sellers to keep stock ready, as these firms E-tailers have asked for digital curfew puters and other accessories. This is
and sellers were of the view that the cur- passes as they feel fresh lockdowns because an increasing most people are
few passes provided to them would expire are possible working from home. According to com-
once the lockdown is lifted (after April munity platform LocalCircles, most cor-
14). The companies have asked for digital lockdown until June-July to flatten the porates have asked their employees to
curfew passes as they feel fresh lock- pandemic curve.” work from home.
downs are possible after April 14. As many delivery personnel have gone As many people were unprepared for
“All these passes and approvals that back to their hometowns, e-commerce such a long lockdown, they are running
they are giving are valid until April 14. So, firms are struggling to get enough of inter- out of items like printer cartridge and
if the lockdown is extended by two more district curfew passes. Instead of going many don’t have a laptop, hence, unable
weeks, then again you have to run to col- from one district to another, the retailers to work from home. Also, with online tuto-
lect the passes,” said an executive at an e- have also asked the government to enable rials starting, parents are struggling to
commerce company. each state to provide the passes. “If my find computers for their children. Most of
“We don’t know if it is staggered delivery associate is getting a pass for these items have still not been consid-
unlocking or it is going to be a continued South Delhi, he can’t do delivery in North ered essential.

Tata Trusts,private
firmjoinhandsto
roll out testing kits
NOTICE is hereby given that:
PAVAN LALL to detect the infection.
Revision in Cut-Off timings for applicability of Net Asset Value (NAV) in respect of purchase and
Mumbai, 7 April Thesetestsuseabloodsam-
redemption of units in the Schemes of Essel Mutual Fund:
ple and punch out results in
Molbio Diagnostics, a diagnos- minutes, but are not as strin- As directed by SEBI the cut-off timings for both subscription and redemption in the Schemes of Essel Mutual
tics company, has partnered gent as other technologies. Fund has been reduced for a temporary period. The revised cut-off timings are given as below:
Tata Trusts to roll out Covid- Nair says his kit uses poly- In case of Subscription and Redemption of Liquid Scheme:
testing kits across the country. merase chain reaction (PCR)
Molbio, founded in 2000, technology, which uses a swab Subscription Redemption
largely focuses on testing for from the throat to diagnose dis- Name of Scheme Existing Revised Existing Revised
diseases including tuberculo- eases — a more accurate meth- Timing Timing Timing Timing
sis and malaria. It can now od when it comes to diagnosis.
diagnose a positive result for “Rapid antibody tests can Essel Liquid Fund 1:30 PM 12:30 PM 3:00 PM 1:00 PM
the coronavirus strain within be used for speed but can’t In case of Subscription and Redemption of Schemes other than Liquid Scheme:
an hour for ~1,350, said detect all cases,” he said.
Chandrashekhar Nair, chief “People could be carriers Subscription Redemption
technical officer of the firm. despite not showing any symp- Name of Scheme Existing Revised Existing Revised
The test — called the tom, and therefore be conta- Timing Timing Timing Timing
Truenat Beta CoV test — effec- gious.Thismeanstestinghasto
Essel Multi Cap Fund 3:00 PM 1:00 PM 3:00 PM 1:00 PM
tively enables same-day test- become universal in India for
ing, reporting, and patient iso- the disease to be truly con- Essel Large Cap Equity Fund 3:00 PM 1:00 PM 3:00 PM 1:00 PM
lation initiation (if required). tained.” Molbio, which has Essel Large & Midcap Fund 3:00 PM 1:00 PM 3:00 PM 1:00 PM
Officials say this is one of the been funded by founders and
few ICMR-approved tests to private investors, has raised Essel Long Term Advantage Fund 3:00 PM 1:00 PM 3:00 PM 1:00 PM
have been validated in a short ~400 crore to date, with ~240 Essel Ultra Short Term Fund 3:00 PM 1:00 PM 3:00 PM 1:00 PM
period of time. crore coming from Motilal
Essel Regular Savings Fund 3:00 PM 1:00 PM 3:00 PM 1:00 PM
Its battery-operated kits are Oswal in recent weeks.
the size of a telephone and can Madhav Joshi, CEO of the Essel Equity Hybrid Fund 3:00 PM 1:00 PM 3:00 PM 1:00 PM
be taken out into the field to India Health Fund (IHF), said Essel 3 in 1 Fund 3:00 PM 1:00 PM 3:00 PM 1:00 PM
test as many as 15 individuals a the initiative focuses primarily
day. They range between ~6.5 on getting innovative projects Essel Arbitrage Fund 3:00 PM 1:00 PM 3:00 PM 1:00 PM
lakh and ~12 lakh, and have and services to market in this The above changes will be effective from April 7, 2020 (Tuesday) to April 17, 2020 (Friday) [both days
received both government and field.TheIHFisagrant-making inclusive]. All other provisions of various SEBI Circulars related to applicability of NAV in case of both
ICMR approval. initiative that has received over subscription and redemption shall remain unchanged.
They will be utilised in loca- $10 million from Tata Trusts
This notice-cum-addendum forms an integral part of the Scheme Information Document (SID)/Key
tions in Uttar Pradesh to start for supporting programs
with, said Nair. around infectious diseases. Information Memorandum (KIM) of the scheme(s) of Essel Mutual Fund as amended from time to time.
The firm has registered The health ministry has All other terms and conditions of the SID & KIM of the schemes of the Essel Mutual Fund shall remain
orders for 1,500 testing kits, said clusters of Covid-19 have unchanged.
which will be deployed soon. appeared in Kerala, Mahara-
For Essel Finance AMC Limited
While the number of Covid- shtra,Rajasthan,UttarPradesh,
(Investment Manager to Essel Mutual Fund)
caused deaths and active cases Delhi, Punjab, Karnataka, Tela-
has been rising sharply, India’s ngana, and Ladakh. More than Place : Mumbai Sd/-
apex health research body had 200districtshavenowreported Date : April 06, 2020 Authorized Signatory
earlier issued an advisory Covid-19 cases, and the risk of
directing containment centres further spread remains very
MUTUAL FUND INVESTMENTS ARE SUBJECT TO MARKET RISKS,
to conduct rapid antibody tests high, it said. READ ALL SCHEME RELATED DOCUMENTS CAREFULLY.