abg shipyard Archives

SpiceJet Q3 Results: Net profit at Rs 23 crore

SpiceJet Ltd reported a net profit of Rs 23.28 crore for the quarter ended December (Q3 FY22). It had posted a net loss of Rs 59.96 crore in the corresponding quarter last year (Q3 FY21). Its revenue from operations rose 33.95% YoY to Rs 2,259.3 crore during the same period. The airline’s capacity in terms of seat kilometers increased by 78% quarter-on-quarter (QoQ), while flight departures increased 59% QoQ.

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ACC commission grinding unit in Tikaria

Cement manufacturer ACC Limited has commissioned a 1.6-million tonnes per annum (MTPA) grinding unit at Tikaria in Uttar Pradesh. With this addition, the total capacity at Tikaria will increase to 3.91 MTPA. The new facility will manufacture environment-friendly cement products with low carbon emissions.

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IndusInd Bank to facilitate digital transactions on e-NAM for agri-value chain participants

The Small Farmers Agri-Business Consortium (SFAC) has selected IndusInd Bank to facilitate digital collection and settlement services on National Agriculture Market (e-NAM) portal for transactions between farmers and traders across India. The bank will offer a range of transaction services via digital modes to the buyer and seller of agricultural produce. This includes multi-net banking, debit card, NEFT, RTGS, IMPS, and UPI.

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Info Edge to acquire 25% stake in Juno Learning

Info Edge (India) Ltd has acquired a 25% stake in Gurugram-based Juno Learning for Rs 11 crore. The company has agreed to acquire 4,331 compulsorily convertible preference shares of the face value of Rs 10 each as the primary acquisition of shares. Juno Learning is building an interactive online school that teaches sales techniques, processes, and tools to entry-level professionals and students to enhance employability.

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Spandana Sphoorty Q3 Results: Net profit at Rs 45 crore

Spandana Sphoorty Financial Ltd reported a consolidated net profit of Rs 45.1 crore for the quarter ended December (Q3 FY22). It had posted a net loss of Rs 29.7 crore in the corresponding quarter last year (Q3 FY21). Its revenue from operations rose 2.4% YoY to Rs 346.1 crore in Q3 FY22. The company’s board has approved a proposal to raise Rs 300 crore via preferential allotments of shares and warrants to support future growth plans.

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Ansal Properties to invest Rs 46 crore for faster completion of projects

Ansal Properties and Infrastructure Ltd (APIL) will invest Rs 46 crore through warrants for reducing debt and speeding up the development of existing projects. The company’s board has approved the issue and allotment of 2.70 crore warrants to promoter group entity and non-promoter (public) investors. APIL has been focusing on reducing debt in the past 12-18 months by settling debts with various lenders.

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SC allows Future Retail to approach Delhi HC on Reliance Retail deal

The Supreme Court (SC) has allowed Future Retail Ltd (FRL) to approach the Delhi High Court to seek permission for the continuation of proceedings in the National Company Law Tribunal (NCLT) regarding the sanction for its merger with Reliance Retail. The SC bench said that the high court should consider the plea of FRL on the issue without being influenced by the observations made in its order.

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ABG Shipyard floated 98 companies to divert funds: CBI

The probe into the alleged fraud caused by ABG Shipyard Ltd (ABGSL) by the Central Bureau of Investigation (CBI) has revealed that at least 98 companies were floated by the accused to divert funds. The diverted funds were then used to create personal assets and for evergreening loans. Last week, the CBI booked ABGSL and its directors for allegedly defrauding a consortium of banks of over Rs 22,8482 crore.

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India’s exports jump 25.28% to $34.5 billion in January

India’s exports rose 25.28% to $34.50 billion in January 2022. This was on account of healthy performance by the engineering, petroleum and jewellery sectors. The trade deficit during the month widened to $17.42 billion. Imports grew by 23.54% to $51.93 billion in Jan.

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The Story

ABG Shipyard Ltd (ABGSL) is one of India’s largest firms engaged in shipbuilding and ship repair. It operates shipyards at Dahej and Surat in Gujarat. The company has the capacity to build vessels up to 18,000 dead weight tonnage (DWT) at Surat Shipyard and 1,20,000 DWT at Dahej Shipyard. The Mumbai-based firm has built over 165 vessels over the past 16 years.

ABG Shipyard’s loan account was first declared as a non-performing asset (NPA) in July 2016. An NPA is a loan for which the principal or interest payment remained overdue for a period of 90 days.

A January 2019 forensic audit report by EY revealed that ABGSL was involved in a number of illegal activities. The audit looked at transactions between April 2012 and July 2017 conducted by ABG Shipyard, its subsidiaries, and vendors. A review of ledgers showed that funds were being transferred between ABG Group companies.

The National Company Law Tribunal (NCLT) had ordered the liquidation of ABGSL in April 2019 under the Insolvency & Bankruptcy Code (IBC). In November 2019, State Bank of India (SBI) filed its first complaint against ABGSL.

Recent Developments

The CBI acted on SBI’s second complaint (filed in August 2020) after scrutinising for over one and a half years on the complaint’s FIR on February 7, 2022.

On February 12 (Saturday), the CBI booked ABG Shipyard Ltd and its directors for allegedly defrauding 28 banks to the tune of Rs 22,842 crore. The company has been accused of criminal conspiracy, cheating, and criminal breach of trust. The agency also alleged that ABGSL’s directors have abused their official position under the Indian Penal Code (IPC) and the Prevention of Corruption Act. This could be the biggest bank fraud case in the history of India.

It was noted that funds received as bank loans were diverted and misappropriated. They had breached terms of its corporate debt restructing. As per reports, ABG Shipyard owes Rs 7,089 crore to ICICI Bank, Rs 3,639 crore to IDBI Bank, Rs 2,925 crore to SBI. It also owes Rs 1,614 crore to Bank of Baroda and Rs 1,244 crore to Punjab National Bank, among others.

The CBI conducted searches at the premises of the private company and its directors at Surat, Bharuch, Mumbai, and Pune. This led to the recovery of incriminating documents.

What Next?

India’s public and private sector banks, which continue to give loans to large corporates and wealthy entities, end up incurring huge losses. People also tend to forget that it is common taxpayers’ money that has been deposited or infused into these banks. We find that there is no sense of accountability or transparency in their activities.

ABGSL has now been referred to the Ahmedabad bench of the NCLT by ICICI Bank for Corporate Insolvency Resolution Process. The investigation related to the scam is underway. We would be able to receive more clarifications from the CBI in the days to come. Will the accused be lawfully punished for their fraudulent activities or will they be able to escape from all charges? Let us wait and watch.