Sep 17, 2013, 08.15 PM | Source: CNBC-TV18
India Glycols is likely to consider action against NSEL issue based on government steps and has not yet made any provision on bourse's exposure, says CEO Rakesh Bhartia.
Speaking to CNBC-TV18, Rakesh Bhartia, CEO of India Glycols says the company wait till the end of this quarter for an appropriate government action. Commodity exchange NSEL stopped trading from July-end due to liquidity crisis. ( Read More )
According to Bhartia, it is premature to come to the conclusion that there will be no recoveries from this crisis because the government is actively engaged in finding a solution. "It is premature to conclude that the whole exposure would need to be provided for or to be written off, "he says.
Bhartia further added that the total amount invested in NSEL is Rs 125 crore and the company has been investing in various instruments since the past 9-12 months.
Below is the verbatim transcript of Rakesh Bhartia’s interview on CNBC-TV18
Q: Do you have any exposure to National Spot Exchange Ltd (NSEL) because we believe there could be about Rs 150 crore exposures that your company may have to NSEL?
A: India Glycols is not invested directly but we have some short-term surpluses that have been invested through our subsidiary IGL Finance.
Q: The subsidiary was 100 percent owned by India Glycols and does that exposure still stand? In that case, would you write that off and show some losses?
A: Is it not premature to come to the conclusion that there would be no recoveries from this whole crisis because the central government is actively engaged in finding a solution to this crisis. There is a committee that has been appointed and headed by Arvind Mayaram, there have been working groups that have been appointed and the finance minister and the company affairs minister are seeing the matter. So, it is premature to conclude that the whole exposure would need to be provided for or to be written off.
Q: What is the exact amount of exposure?
A: The amount of exposure is in excess of about Rs 125 crore.
Q: Is IGL Finance a 100 percent owned subsidiary of India Glycols?
A: Yes, It is.
Q: You also said that it is premature to write it off but at least in part of the exposure will you consider making a provision?
A: We will wait for the government action till the end of this quarter and the board will then need to evaluate what will be appropriate when we consider our results for this quarter.