Transaction Details
The company, through State Bank of India, has provided a Standby Letter of Credit (SBLC) of INR 3.75 crores (equivalent to NPR 6 crores) in favor of Everest Bank Limited, which is the Lead Bank of the Consortium of Nepalese Banks. This SBLC was provided on behalf of Kajaria Ramesh Tiles Limited, Nepal, a Joint Venture Company.
Specific Terms and Conditions
- Guarantee Amount: INR 3.75 crores (equivalent to NPR 6 crores)
- Beneficiary Bank: Everest Bank Limited (Lead Bank of Consortium of Nepalese Banks)
- Purpose: Against Term Loan of Nepalese Rupees (NPR) 12 crores (equivalent to INR 7.50 crores) being availed by Kajaria Ramesh Tiles Limited, Nepal
- Instrument: Standby Letter of Credit (SBLC)
- Intermediary Bank: State Bank of India
Related Party Considerations
Mr. Chetan Kajaria (Vice Chairman) and Mr. Rishi Kajaria (Managing Director) and member(s) of the Promoter Group of the Company are also Directors of Kajaria Ramesh Tiles Limited, Nepal. The company has obtained prior approval from the Audit Committee for providing the SBLC, and the transaction was conducted at arm's length.
Financial Impact Assessment
There is no immediate financial impact from this transaction. However, there may be contingent liability to the extent of the SBLC amount (INR 3.75 crores).