Suraksha Group injects ₹125 crore to revive stalled Jaypee projects

The Suraksha Group has invested ₹125 crore in Jaypee Infratech to accelerate construction, providing hope to over 20,000 homebuyers.

The investment is in the form of promoters equity as part of the approved resolution plan. The company announced it is ready to start construction work and will focus on timely delivery.

On May 24, the National Company Law Appellate Tribunal (NCLAT) approved Suraksha's resolution plan, directing the company to compensate YEIDA with ₹1,335 crore over the next four years for the benefit of farmers.

Suraksha's plan, submitted to the bankruptcy court in April, originally proposed ₹1,216 crore in enhanced compensation, with payments structured as 10% within 90 days, 15% by the end of the first year, and 25% annually over the next three years.

Sudhir V Valia, promoter of the Suraksha Group, has been appointed as a non-executive director on the JIL board. Additionally, the JIL board has appointed Aalok Champak Dave as the executive director and Usha Anil Kadam as an independent director. The board of directors has also approved the appointment of Devang Pravin Patel as chief financial officer.

This coming weekend, Suraksha will host a webinar to interact with homebuyers, address their concerns, and provide updates on the plan.

According to a homebuyer, 20,000 families in Jaypee Wishtown, Noida, have been struggling for the last more than 10 years to get their dream house.

Each home buyer has incurred expenses twice the amount paid to Jaypee Group towards their home by way of interest and rent in these 10 years. There are approximately 100 towers where Jaypee has not laid even one brick since 2014.

The delivered flats are also below the standard quality, and the amenities promised by them at the time of booking have not been provided.

Jaypee Infratech, a real estate and infrastructure company, was among the initial 12 entities the central bank had referred to the NCLT in August 2017 under the Insolvency and Bankruptcy Code (IBC).

Since the resolution's admission more than five years ago, the lead lender, IDBI Bank, has faced four rounds of bidding and various lawsuits, frustrating both lenders and home buyers. The projects include multiple residential towers in Noida and Mirzapur.

In June 2021, the CoC, through a court monitored process, finally approved SurakshaARC's bid to take over the distressed borrower.

Jaypee Infratech owes IDBI Bank, ICICI Bank, IFCI, the State Bank of India (SBI), and homebuyers a total of ₹22,600 crore. Homebuyers have advanced ₹12,714 crore, or 55% of the debt, while lenders have 43%, or ₹9,234 crore, of the debt.

In January, banks led by IDBI sold their debt to the NARCL, marking the first acquisition for the government-backed bad loan aggregator. The NARCL had offered ₹3,570 crore, the biggest to date by the government-backed bad bank.

Suraksha's revised resolution plan raised the aggregate offer to institutional financial creditors by ₹1,298 crore, bringing the total offer to ₹7,736 crore. The other contender was NBCC.