Jaiprakash Associates shares climb 5%, take 3-day gains to 16%; here's why

Shares of Jaiprakash Associates Ltd climbed for the fourth straight session on Wednesday after the company reportedly offered Rs 16,000 crore to lenders as settlement offer in a bid to avoid bankruptcy.
The stock hit its 5 per cent upper circuit limit at Rs 6.99. It is up 16 per cent in three sessions, but still down 67.35 per cent year-to-date. It hit a 52-week high of Rs 27.17 in February this year.

JP Associates has reportedly proposed an upfront payment of Rs 4,000 crore, to be made nine months after lenders approve the settlement. To raise these funds, the company plans to bring in investors and sell some of its assets, according to The Economic Times, citing sources familiar with the negotiations. The remaining Rs 12,000 crore is expected to be paid, with the majority of the payment occurring after three years, the report added.

Banks are still evaluating the Rs 12,000-crore offer from the government-backed National Asset Reconstruction Co. (NARCL). According to The Economic Times, citing a source familiar with the negotiations, the offer is based on several assumptions and a lengthy payment timeline, which banks find unappealing. This feedback has reportedly been communicated to JP Associates.

At present, JP Associates' appeal against its admission into insolvency is with the National Company Law Appellate Tribunal (NCLAT).

The second-largest unresolved insolvency case before the National Company Law Tribunal (NCLT) involves JP Associates, with admitted claims amounting to Rs 57,190 crore. The largest case currently pending is that of Videocon Industries, which owes Rs 65,000 crore to banks.

JP Associates faces admitted claims totaling Rs 57,190 crore, making it the second-largest unresolved insolvency case before the National Company Law Tribunal (NCLT). The largest case is that of Videocon Industries, which owes Rs 65,000 crore to banks.