Gitanjali Gems seeks Rs 1000 cr loan from banks: Media Report

Jewellery retailer, Gitanjali Gems, is seeking for more than 1000 crore loans from the banks on the back of Reserve Bank's new rules on gold import, said Economic Times.

Recently, the Reserve Bank of India directed banks to collect payment upfront from gold importers opening letter of credits with them, cutting short the three months' credit facility that importers enjoy, said the media report.

Moreover, the sharp decline in the rupee against dollar raised the import bills of the company, thus the loan that was sanctioned earlier at exchange rates of 52-53 to a dollar could not do much.

Three Banks with an exposure of Rs 4,500 crore to the Gitanjali group, met in a consortium led by Allahabad Bank earlier this week, where Mehul Choksi, the Group Prmoter, urged for additional funds and conversion of non-fund-based limits into fund-based loans, added Economic Times.

In addition, the report stated that the Bankers have agreed in principal to support the company, provided the promoter is able to bring in additional collateral.

Dion Global Solutions Ltd.

Read more about: gitanjali gems, loan, banks, gold import
Story first published: Monday, September 2, 2013, 9:10 [IST]
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