Write-offs of Rs 280 cr adds up Gammon India loss to Rs 454 cr
Write offs of Rs 280 crore have further added to the losses of Gammon India. Due to write offs Gammon India has faced a loss of Rs 454 crore. This has been reported in the audit result done in December.
The net sale decreased by 16.3% to Rs 1,020 crore and loss of Rs 150 crore due to the high raw material cost. Another reason of loss is provisions for doubtful debts of around Rs 60 crore.
IDFC Institutional Securities mentioned in a report that the gross interest expense increased by 14 percent to Rs 140 crore while the debt increases to Rs 4,340 crore as on December 2013 from about Rs 4,200 crore in the second quarter ended September 2013.
The report also concluded that the increase in debt is because of interest term loans and devolvement of certain LCs.
IDFC point outs that the positive thing is “sustained order inflow” whereas the negative aspect is elevated debt levels and continued margin pressure impact on financials.
The Indian brokerage firm experienced an increase in standalone net loss to Rs 470 crore for FY15 against earlier estimate of a net loss of Rs 380 crore.
The brokerage says that the currently sanctioned CDR packages provide the company some relief. Debt reduction through the sale of property is the only option in front of them to improve their situation.
Source: The Financial Express
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