Educomp Solutions shares hit 10% upper circuit on CDR plans

MUMBAI: Shares of Educomp Solutions were locked at 10 per cent upper circuit after the company announced that it has initiated discussions with its lenders and has approached CDR forum to restructure its rupee debt to correct the asset liability mismatch on its balance sheet.

At 10:00 a.m.; the stock was at Rs 37.25, up 9.88 per cent, on the BSE. It touched a high of Rs 37.25 and a low of Rs 35.50 in trade today.

"The company has also approached CDR forum for restructuring of debt in its K-12 business. The debt-restructuring exercise will enable the company to comprehensively address the liquidity issues by matching the maturity profile of debt with the relatively long-term nature of its investments," the company said in a filing to the stock exchanges.

The company has been under pressure since January on corporate governance issue. Last month, rating agency CARE revised their rating on the company to 'Default'.

"The revision in the ratings of Educomp Solution Limited (ESL) takes into consideration the ongoing delays by the company in the servicing of its debt obligations pertaining to the bank facilities," CARE Ratings said in a report.