Multibagger Jewellery Stock Makes One-Time Settlement of Cash & Equity With Indian Overseas Bank

PC Jeweller, a small-cap company in the consumer durable sector in focus after the company announced a one-time settlement of cash and equity components with Indian Overseas Bank. On Wednesday, the shares of PC Jeweller closed at a 5% upper circuit limit at Rs 94.01 apiece.

Indian Overseas Bank vide its e-mail dated July 31, 2024 has conveyed sanction to the One Time Settlement ("OTS") proposal submitted by PC Jeweller.

"The Company had opted for OTS to settle the outstanding dues. The terms and conditions of approved OTS include cash and equity components payable under settlement, release of securities and mortgaged properties etc," said PC Jeweller in a stock exchange filing.

In order to pay off its debt, PC Jeweller Ltd. came to an agreement last week with a group of lenders headed by State Bank of India (SBI) to provide banks with an assortment of cash and equity in the Delhi-based company. PC Jeweller Limited recently said that its One Time Settlement (OTS) plan has been approved by Canara Bank. In order to settle its outstanding debts, the corporation made this arrangement.

The company had previously obtained permission from Bank of Baroda, IndusInd Bank, Punjab National Bank and Union Bank of India to utilise the One-Time Settlement (OTS) concept, which enabled them to settle outstanding debts by combining cash and equity payments.

"The Company has engaged the services of KFintech, as the Agency, for participation of Members in the EGM through VC / OAVM, facility for remote e-voting and e-voting at the EGM. Only those Members, whose names appear in Register of Members / List of Beneficial Owners as on Thursday, August 1, 2024 ("Cut-off Date") shall be entitled to vote (through remote e-voting and evoting at the EGM) on the resolution set forth in this Notice and their voting rights shall be in proportion to their share in the paid-up equity share capital of the Company as on the Cut-off Date. A person who is not a Member as on the Cut-off Date should treat this Notice for information only," said the company in a statement.
"The Company has however, taken proactive action in resolving the legal cases by approaching its lenders to resolve the issue of unpaid debt with a One Time Settlement Proposal and upfront payment for the furtherance of the proposal was deposited in a no-lien account with SBI by promoter Group entity. The internal authorities of three banks, namely, The State Bank of India (Lead Bank), Karur VysyaBank and Axis Bank, have given their acceptances to the company's offer in Q4 FY 2024. The offer is under consideration with the competent authorities of the remaining consortium banks and the company is positive and confident of receiving their acceptances soon. Further, on account of settlement terms agreed between SBI and the Company, the State Bank of India (Lead Bank) had also filed an application for withdrawal of its petition filed before Hon'bleNCLT, Delhi seeking initiation of Corporate Insolvency Resolution Process under section 7 of IBC against the company. The said petition was disposed as withdrawn, by Hon'ble NCLT, Delhi vide its order dated April 30th, 2024," said PC Jeweller in a stock exchange filing.

The firm is confident that it will be able to recover its lost market share and business, as well as continue to display strong performance in Q1 FY 2025 and the upcoming quarters, thanks to a spike in sales and operational levels and favourable response from its clients.