The State Bank of India (SBI) has taken possession of two New Delhi properties from PC Jewellers following a substantial loan default. The recovery efforts by SBI come after PC Jeweller's announcement of a default exceeding Rs 3,466 crore in October. The company's financial troubles have led to significant operational disruptions, evident in the drastic fall in their second-quarter revenues for the fiscal year 2024.
SBI's claim on the New Delhi properties totals Rs 1,267 crore, a move aimed at recouping some of the Rs 1,168.90 crore owed by PC Jewellers. The bank has been actively pursuing recovery through various legal channels, including the National Company Law Tribunal (NCLT) and the Debt Recovery Appellate Tribunal.
The company's financial difficulties have had a stark impact on its performance. Compared to the same quarter last year, when revenues stood at Rs 836 crore, PC Jewellers reported a plunge in Q2 FY24 revenues to just Rs 33 crore. This significant downturn has also resulted in reported losses of Rs 152 crore.
In response to the crisis, PC Jewellers has closed a total of seventeen stores, which includes fourteen owned and three franchises. The company is also actively engaged in negotiating out-of-court settlements with various banks to address its debts. The impact on PC Jewellers is a reflection of the broader challenges faced by the Indian jewelry sector, which has been grappling with issues of credit and market trust.
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