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Ind-Ra downgrades Jana Capital, Jana Holdings NCDs to default
Jana Holdings Ltd (JHL) owns about 17% in Jana Small Finance Bank, which is publicly listed. The bank’s share price opened sharply lower Wednesday at Rs 445 against the previous close of Rs 469 but recovered immediately and closed barely changed at Rs 468.80.
The rating company said that JHL and Jana Capital Ltd (JCL) have repayments of around Rs 4200 crore in total due on June 30 as principal plus accrued interest.
Indian government bonds saw gains as anticipation of Bloomberg index inclusion and improved liquidity bolstered prices. Despite higher U.S. yields and rising oil due to geopolitical tensions, traders are optimistic. Foreign investors have significantly boosted purchases of Fully Accessible Route bonds, driven by expectations of their inclusion in global indices. Market sentiment hinges on monsoon progress and global stability for further rallies.
“While the entities had previously met debt repayments through refinancing, they were unable to do so on this occasion. Consequently, the tenure extension has been undertaken to avoid a potential default on the original due date, and has therefore been treated as a distressed debt exchange and a default by Ind-Ra,” the rating company said Wednesday.
Jana Capital is a core investment company, which promoted Jana Holdings as the non-operative holding company to hold the promoter stake in the small finance bank.
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Both JCL and JHL are non-operating entities with no cash-flows of their own, and were to make payments towards the NCDs either by a stake sale of their operating banking entity or through refinancing.
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