Section 13 of SARFESI Act and their Rules
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Awaiting price reaction for this filing.
Union Bank of India has taken possession of Kallam Textiles' 2.0 MW Hydel Power Project located at Nelakondapalli, Khammam, Telangana, under Section 13(4) of the SARFESI Act, 2002. The action follows the company's failure to repay a loan of approximately Rs. 185.36 crores (Rs. 185,35,71,199.66) despite a demand notice issued on 11.09.2024. The bank has taken possession of the hydro power project's immovable properties (land, canal, powerhouse, buildings) and movable assets (plant and machinery of the Hydel Power Division). Kallam Textiles has been directed to redeem the secured assets, with the company stating it will keep the exchange updated on further developments.
This is a significant negative event for shareholders — the company has lost operational control of its Hydel unit to its lender over a Rs. 185+ crore default, and the bank may now move to auction the assets to recover dues. This raises serious concerns about the company's financial health and could put further pressure on the stock price.