Kochi-based FACT faces ₹438 crore penal interest on government loan, seeks waiver
Key Takeaways
- •FACT is facing a penal interest liability of ₹438 crore on a government loan and has sought a waiver of the amount.
- •FACT's shares closed at ₹807.00 on the BSE, down ₹7.20, or 0.88%, on the day.
- •Founded in 1943, FACT was India's first large-scale fertiliser plant and operates under the Ministry of Chemicals and Fertilisers.
- •FACT received a 2020 turnaround-linked restructuring package that converted loans into capital infusion.
- •If the penal interest demand stands, it would weigh on FACT's financials, and the government's waiver decision is a key factor to watch.
Kochi-based Fertilisers and Chemicals Travancore Ltd (FACT) is facing a penal interest liability of ₹438 crore on a government loan and has sought a waiver of the amount.
The development was reported by CNBC-TV18 Markets (source).
Shares of FACT ended at ₹807.00 on the BSE, down ₹7.20, or 0.88%, on the day.
FACT is a public sector fertiliser and chemicals manufacturer headquartered in Kochi, Kerala, and operates under the administrative control of the Ministry of Chemicals and Fertilisers, Government of India. Founded in 1943, FACT was the first large-scale fertiliser plant in India and has historically relied on government financial support, including a turnaround-linked restructuring package announced in 2020 that converted loans into capital infusion, reflecting its recurring dependence on state assistance.
The scale of the liability matters for a public sector company whose profitability is sensitive to fertiliser subsidies, gas feedstock costs and urea pricing policy. Whether the government agrees to waive the penal interest will be a key detail to watch, along with any disclosure of the loan's original terms and the timeline for a decision, as such a demand would weigh on FACT's financials if it stands.
