Granting of Corporate guarantee to Ventura Securities Limited (Subsidiary Company).
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Ventura Guaranty Limited has issued a corporate guarantee in favour of IDFC First Bank to secure working capital facilities of up to ₹150 crores for its 88.29% subsidiary, Ventura Securities Limited (VSL). The formal guarantee agreement is yet to be executed. The promoters are interested only to the extent of their shareholding and directorship in VSL, and the transaction is conducted at arm's length. As of now, the guarantee has no immediate financial impact on the listed entity but constitutes a contingent liability on Ventura Guaranty's books.
The guarantee creates a contingent liability of up to ₹150 crores for Ventura Guaranty, exposing it to the credit risk of its subsidiary. If VSL defaults on the working capital facility, Ventura Guaranty would be liable to repay the bank. Shareholders should monitor VSL's financial performance, though the intercompany nature of the arrangement suggests internal group support.