HCC hits 20% UC

HCC rushed up to notch top space in the gainers list after it announced that it completed its debt resolution plan supported by 23 banks and financial institutions.

The resolution plan has carved out a significant portion of HCC’s debt along with commensurate assets from its balance sheet.

The plan comes on the back of sustained operations momentum and robust performance alongside return of capital by its concessions arm.

Under this debt resolution plan, HCC has transferred Rs 2,854 crore of lenders’ liability along with beneficial economic interest in arbitration awards & claims of Rs 6,508 crore as consideration to a special purpose vehicle (SPV).

This SPV will have an external investor controlling at least 51% and HCC holding balance shares. The SPV debt is significantly over-collateralised and is expected to be fully serviced from its own receivables. The underlying arbitration awards also carry interest (income), which comfortably cover any accrued interest on SPV debt.

Upon repayment of SPV liabilities, HCC will have the right to receive surplus cashflows as a separate transaction, from realisation of awards and claims (expected to be of significant value).

The stock rose to Rs.14.66, going on to hit the 20% UC of the day. Volumes are up over 14.5 times. Its 52-week high is at Rs.20.03.