HCC slashes corporate guarantee for PRPL by ₹3,364 crore

Hindustan Construction Company (HCC) has achieved a major milestone by reducing its corporate guarantee obligation for Prolific Resolution Private Limited (PRPL) by ₹3,364 crore. This reduction stems from a debt restructuring plan initiated in September 2022, where HCC transferred ₹2,854 crore of debt and ₹6,508 crore of awards and claims to PRPL. HCC maintained a 49% equity stake and initially provided a 100% corporate guarantee for PRPL's debt.

Following approvals from PRPL's lenders, board, and other stakeholders, HCC's guarantee obligation has been reduced from 100% of the outstanding amount to ₹571 crore, representing 20% of the principal amount originally transferred. This move aligns with HCC's strategy to de-leverage its balance sheet and enhance its financial standing.

The reduction in corporate guarantee is expected to facilitate HCC's access to larger credit facilities and equity capital, including a recently announced rights issue supported by its promoter group, positioning the company for stronger future growth and scale of operations.