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Coffee Day Enterprises Ltd (CDEL) has revealed a significant default on debt repayments amounting to Rs 425.38 crore (USD 51 million) as of March 31, 2025, attributing the shortfall to a severe cash crunch and ongoing legal disputes with its lenders.
In a regulatory filing, CDEL outlined that the default covers missed payments on loans from both banks and financial institutions, as well as outstanding dues on unlisted debt instruments such as non-convertible debentures (NCDs) and non-convertible redeemable preference shares (NCRPS).
The company detailed a default of Rs 174.83 crore in principal and Rs 5.78 crore in interest on loans and credit facilities, such as cash credit, from various banks and financial institutions. Additionally, CDEL has defaulted on Rs 200 crore of principal on NCDs and NCRPS, along with interest payments totaling Rs 44.77 crore.
Due to unresolved liabilities and a pending one-time settlement, CDEL suspended interest recognition from April 2021. The company added that several of its lenders had issued loan recall notices and initiated legal actions.
CDEL has been grappling with financial difficulties since the tragic death of its founder and former chairman, V.G. Siddhartha, in July 2019. In a bid to alleviate its debt burden, the company repaid Rs 1,644 crore to 13 lenders in March 2020, following the sale of its technology park to the Blackstone Group.
Further legal complications arose in August 2024 when IDBI Trusteeship Services Ltd filed an insolvency petition, citing a Rs 228.45 crore default. The Bengaluru bench of the National Company Law Tribunal (NCLT) admitted the plea and appointed an interim resolution professional. However, the proceedings were quickly challenged, and the NCLAT stayed the case on August 14, 2024.
Additionally, CDEL is pursuing legal action to recover over Rs 3,535 crore, alleging that the funds were misappropriated into Mysore Amalgamated Coffee Estates Ltd, a company founded by V.G. Siddhartha.
(Source: PTI)
