Stock to Watch: HCC

Hindustan Construction Company's (HCC) real estate development arm Lavasa Corporation Ltd is all set to get lender's approval for a financial restructuring plan that has been under consideration for some time now as per the leading international news agency.

Lavasa's plan to enter the affordable housing segment and the recent changes in the joint lender forum (JLF) guidelines are the two major reasons that will allow the company to restructure nearly Rs 3500 crore debt. The same restructuring is possible under the Reserve Bank of India's (RBI) 'flexible structuring of long-term loans'. 

RBI, recently tweaked its JLF rules which facilitate the restructuring of the proposal is cleared by 60 per cent of the lenders by value. Previously the threshold was 75 per cent.

Lavasa's restructuring plan has received the support of most of the lenders expect a couple of the public sector banks according to the news agency.

The development is sentimentally positive for the stock. HCC has generated over 130 per cent returns in the one-year time frame and on YTD basis the stock is up by 12 per cent.