BENGALURU: A liquidity crisis at Coffee Day has led to delays in servicing debt worth Rs 518 crore at the end of March 2021, the company said in an exchange filing earlier this week.
The dues include outstanding loans worth Rs 280 crore and Rs 200 crore of non-convertible debentures (NCDs). The company couldn’t state when it will be able to clear its dues, putting a question mark over its recovery, which has dragged for about two years. Coffee Day declined to comment when contacted by TOI.
The development has led its lenders to explore the possibility of dragging the company, which runs the Cafe Coffee Day (CCD) chain, to the National Company Law Tribunal (NCLT) for a debt resolution programme, according to reports.
Malavika Hegde, CEO and wife of Coffee Day’s late founder V G Sidhartha had stated her intention of reducing debt to keep the company afloat. The company is trying to slash debt to below Rs 1,000 crore. Covid has put huge pressure on the company’s cafe and vending machine businesses.
“Covid-19 is significantly impacting the business operations of the group by way of interruption in supply chain disruption, unavailability of personnel, closure/ lockdown of hospitality services and travel bans,” the company’s auditors said.