Vishal Retail’s recovery plans

Debt-ridden Vishal Retail has been struggling with lenders for quite some time but is confident

its loan restructuring will be through within two months. With an inventory size of around Rs 200 crores, it had sales of Rs 130 crores. In this quarter, Vishal expects sales worth Rs 350 to Rs 375 crores and for the whole year it expects sales worth Rs 1,500 to Rs 1,800 crores.

Last year, the retail chain faced losses but now it’s improving its interest burden. Now, they are in Ebitda (earnings before interest, taxes, depreciation and amortisation) profit. This is a remarkable improvement considering that last year there were inventory write-offs. According to the retailer whatever inventory they currently have is correct and saleable in the market. However, there are some issues in implementing the corporate debt restructuring (CDR) package even after it has got formal approval. The buzz is that investors like Texas Pacific Group are showing interest in the company. Having recruited 125 MBAs, the company wants to reach a position where it can pay off the debt, with interest to all the lenders, without any outside help. There may be an out-of-court settlement with DBS. Also, the retailer is trying to have a dialogue with non-CDR lenders who are taking their own measures for debt recovery.