India’s Power Finance Turns Down Rs 20,000 Crore Debt To Shapoorji

India’s state-run Power Finance Corporation Ltd has decided against extending a loan to Shapoorji Pallonji Group, a top official said, throwing into doubt the infrastructure conglomerate’s plans to refinance debt worth around Rs 20,000 crore ($2.4 billion).

“We have decided not to go ahead with sanctioning of the loan of Shapoorji Pallonji,” Chairman and Managing Director Parminder Chopra told analysts in a call on Friday. She added that PFC had done due diligence and found it was a new sector for the government-backed lender to fund.

“Ultimately, the board decided not to go ahead with the loan of around Rs 20,000 crore,” she told Bloomberg News on Saturday.

Mint newspaper reported the development first.

The group, controlled by Indian billionaire Shapoor Mistry, had earlier reached out to Power Finance for the loan. Proceeds of the loan would primarily be used to refinance an old credit facility.

With the latest move, the company may have to find new ways to raise money.

Mumbai-based Afcons Infrastructure Ltd., the engineering and construction arm of the Shapoorji Pallonji Group recently raised money through selling new shares, while founder Goswami Infratech Pvt. offered shares worth Rs 4,180 crore in the IPO, somewhat helping it tide over its funding requirements.