One of the biggest housing finance companies, Dewan Housing Finance Corp Ltd ( DHFL ) declared that the financial situation of the company has become so bad that the operations have become very difficult. DHFL has reported a loss of Rs. 2,223 crore in January- March quarter.
The company said it was "undergoing substantial financial stress" and its ability to raise funds was "substantially impaired and the business has been brought to a standstill with there being minimal/virtually no disbursements."
Kapil Wadhawan, Chairman and MD of DHFL, says that "These developments may raise a significant doubt on the ability of the company to continue as a going concern."
The company is facing financial crisis since the second half of last financial year. The company had to make additional provisioning of 3280 crores in the fourth quarter of fiscal year 2018-19. The company had outstanding one lakh crores till the end of December. It has 38 percent of the banks. SBI's outstanding balance is highest.
Under the inter-creditor agreement the company is in an advanced stage of submitting its resolution process. The inter-creditor agreement will examine and firm up the terms of the resolution process by July 25, 2019 and make it operational before September 25, 2019.