InvestorQ : With Suzlon restructuring plan being approved by SBI consortium, is it worth buying the stock right now? It is available at just Rs.2.
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With Suzlon restructuring plan being approved by SBI consortium, is it worth buying the stock right now? It is available at just Rs.2.

Answer
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6 months ago


SBI has just approved the restructuring plan for Suzlon’s Rs.14,000 crore of debt, being the leader of the consortium that lent to Suzlon. A part of the sustainable debt of the company will be converted to equity and banks will write off part of the unsustainable debt of Suzlon.

The promoters will also infuse around Rs.400 crore into the company to give it a chance to revive the business. As per the plan, nearly Rs.8200 crore of debt will be converted into optionally convertible debentures (OCD) with tenure of 20 years.

Suzlon has also been asked to reduce its debt by monetizing some of its assets. The good news for Suzlon is that it will not go into NCLT bankruptcy but the restructuring plan will give the company one more chance at reviving its failing business model.