Bhushan Steel up by 20 per cent today, lenders acknowledge for Rs 30000 crore loan recast

Today, the stocks of Bhushan Steel climbed up 20 per cent to Rs. 66 after receiving the lender's approval of a Rs. 30000 crore loan for long term restructuring under a scheme of the Reserve Bank of India. Investors are now keeping an eye and queuing up for buying the shares of Bhushan steel. From around 9:40 in the morning there were 194191 shares buy orders pending as there were no sellers available.

The tenure of 25 years under the RBI's scheme for long term structuring of loans is in line with the cash flow, agreed by Joint Lenders Forum (JFL) to extend the loans of Bhushan steel. Around 70 per cent of the lenders have approved the scheme and by the end of July 2015 it should get closed, as the sanction from few banks are still awaited. Once they are cleared the plan will begin. Bhushan Steel has four-year suspension on principal repayment, and after that the company will get a 21 year repayment period, with a provision to refinance every five years.

The banks involved here, include Punjab National Bank who is leading and has total exposure of about Rs 30000 crore in the company. PNB, State Bank of India, Canara Bank, Bank of India and Dena Bank are the other banks currently involved.

 Bhushan Steel has been reporting losses for the last five quarters till the fourth quarter of FY15. In the March quarter the net loss stood at Rs 360 crore. Bhushan Steel shares fell by almost 80 per cent last year. But after the 30000 crore loan acknowledgement from lenders, the investors are taking interest again in these shares.