Future Enterprises tanks 4% as it defaults on Rs 16 crore interest payment

NEW DELHI: Shares of Future Enterprises (FEL) fell 4 per cent in Wednesday's trade after the company defaulted on interest payment of non-convertible debentures (NCDs).

FEL had also defaulted on interest payment of another non-convertible debenture last week. Before that it had on September 14, 2020, defaulted on payment of commercial paper worth Rs 90 crore.

Following the fresh development, the stock fell 4.07 per cent to hit a low of Rs 12.95 on BSE.

The fresh default amounts to an interest payment of Rs 16.11 crore for a gross principal amount of Rs 332 crore.

"The company is unable to service its obligations in respect of the interest on non-convertible debentures due on September 27, 2020, since September 27, 2020 was a holiday, interest was due on September 28, 2020," FEL said.

The obligation had a coupon rate of 9.60 per cent per annum and was paid on a half-yearly basis on March 27 and September 27 each year.

Last month, the board of the FEL had approved amalgamation of the Future Group entities -- Future Retail with the company to facilitate Rs 24,713 crore deal to sell the retail and wholesale business to Reliance Retail, owned by oil-to-chemical conglomerate Reliance Industries Ltd.

FEL develops, owns and leases retail infrastructure for the Future Group. It handles backend operations of the retail business of Future the group.

It reported a consolidated net loss of Rs 322.92 crore for the June quarter. Revenues for the company fell 87.31 per cent to Rs 179.39 crore in the same quarter.