NCLT admits Reliance Naval for insolvency

The Ahmedabad bench of the National Company Law Tribunal (NCLT) has admitted an application against Reliance Naval and Engineering Limited (R-Naval) for insolvency.

“The application by IDBI Bank Ltd. for a claim of ₹1,159.43 crore before the NCLT Ahmedabad bench has been admitted,” R-Naval said in a filing with the exchanges.

Second group firm

This is the second Reliance Group firm to go for insolvency after Reliance Communications. The company had total outstanding dues of ₹9,534 crore as on December 31, 2019. It reported a net loss of ₹340 crore on net sales of ₹20.5 crore for the second quarter ended September 30, 2019.

The promoters own 29.84% stake in the company; 61.94% is held by non-institutional investors, while 7.93% stake is held by insurance companies.

Anil Ambani had bought over Pipavav Defence, a struggling firm in 2015, and renamed it Reliance Naval, hoping to bag big defence contracts, especially to make submarines.