Religare, Fortis Healthcare plunge on promoter entity woes

NEW DELHI: Shares of Religare Enterprises and Fortis Healthcare plunged up to 8 per cent on Monday after rating agency India Ratings downgraded RHC Holding’s NCDs to default.

RHC Holding, along with Oscar Investments, jointly owns the two companies.

Following the development, shares of Fortis Healthcare slumped 8.66 per cent to Rs 148.80 on BSE. Religare Enterprises dropped 4.14 per cent to end the day at Rs 112.35.

The rating agency said that a default was a result of RHC failing in servicing its coupon obligations on its non-convertible debentures.

“The obligations were due on 27 June. Post the default, RHC has been given a new future date in July to make the payment. The outstanding principal amount stands at Rs 200 crore for this issue. The downgrade of the ratings on other debt instruments reflects an impaired debt servicing capability due to a stretched liquidity position,” it said.

The rating agency noted that RHC was unable to meet its planned deleveraging target through the monetisation of non-core assets, as envisaged earlier.

RHC and Oscar Investments face a total contingent liability of about Rs 3,500 crore towards an adverse verdict by a Singapore-based appellate tribunal on a lawsuit filed by Daiichi Sankyo Company against selling shareholders of Ranbaxy, it noted.

“An adverse outcome in Indian courts may further worsen the impact on the liquidity situation of the group,” it said.