StartupTalky

Tag: NCLT

  • Gensol Faces Insolvency Proceedings as Ireda Moves NCLT

    Following Gensol Engineering’s default on a loan of INR 510 crore, the state-run financier Indian Renewable Energy Development Agency (Ireda) filed a petition against the business under Section 7 of the Insolvency and Bankruptcy Code, Ireda said in a stock exchange filing on 14 May.

     The value of stock interests is likely to be destroyed if the National Company Law Tribunal accepts the insolvency petition, and all of the company’s creditors are anticipated to submit their claims to the court-appointed resolution professional for debt resolution.

    Gensol is Navigating Through Troubled Waters

    In addition to other regulatory enquiries, Gensol is being investigated by the Securities and Exchange Board of India (Sebi) for allegedly diverting funds from the listed company by its promoters. Anmol Singh Jaggi and his brother Puneet Singh Jaggi, the founders of Gensol Engineering and BluSmart Cabs, resigned from the Gensol board in response to the Sebi ruling, stating in a letter to the exchanges that their actions were in accordance with Sebi’s directives.

     Puneet served as Gensol’s full-time director, while Anmol served as managing director. Prior to this, Ireda started an internal examination on April 25 in accordance with its own due diligence procedures and Reserve Bank of India rules.

    Ireda claimed that the promoters had violated the terms of the contract by diluting their shareholdings without the lenders’ consent. As a result, on April 24, Ireda complained to the Economic Offences Wing about the aforementioned issues with Gensol.

    RBI Probes E-Wallets After BluSmart Collapse

    According to various media reports, India’s central bank is investigating some digital wallets linked to electric vehicle companies after the abrupt demise of the nation’s biggest all-EV taxi service prevented customers from accessing funds linked to their accounts.

    The issues encountered by customers of the digital wallet of the app-based ride-hailing service BluSmart led to a review of the payment methods utilised in India’s nascent EV ecosystem.

    The incidents brought about by the company’s alleged fraud exposed the absence of protections for customers who deposit funds into so-called closed-loop wallets in order to conduct transactions on apps, particularly those that deal with EVs like charging stations or ride-booking.

    According to various published reports, the Reserve Bank of India has started informal conversations with operators of EV charging stations and other app-based EV platforms in order to evaluate potential consumer hazards.

     In India’s rapidly expanding digital services ecosystem, so-called closed-loop wallets—app-based payment systems that are limited to use on a single platform—have become widely available. Since the central bank does not actively supervise these wallets like it does open-system wallets under its regulation, they are more susceptible to platform failure.

    In April, BluSmart informed customers that it could take up to 90 days to reimburse money after thousands of users who had preloaded money into the wallet to book trips within the city and at the airport were unable to secure a refund or move the money to another location.

  • Pine Labs Receives Final NCLT Approval to Reverse Flip to India

    Fintech giant Pine Labs has now obtained the National Company Law Tribunal’s (NCLT) final approval to combine its Singaporean and Indian businesses, marking another step forward in its reverse flipping journey. Consequently, current shareholders of the Singaporean company will receive shares in Pine Labs. According to a corporate spokeswoman, the alignment supports the company’s long-term goal of providing value to stakeholders, partners, and customers while also aiming to improve operational efficiency. This occurs months after Pine Labs was given preliminary NCLT approval in August to move its headquarters from Singapore to India.

    Move is Aligned to Prepare for IPO

    Pine Labs’ intentions to change its domicile are consistent with its prospective $1 billion IPO aspirations. Additionally, it has already selected five bankers for its initial public offering (IPO), including Axis Capital, Morgan Stanley, Citigroup, JP Morgan, and Jefferies. The company appears to be far from reaching profitability, even though its initial public offering (IPO) is quickly approaching. Its net loss increased from INR 56 Cr in the prior fiscal year to INR 187 Cr in FY24. However, compared to INR 1,281 Cr in the prior fiscal year, its operational revenue in FY24 was INR 1,317 Cr. Pine Labs is making its second attempt to go public. Due to adverse market conditions, its initial aspirations to list on US markets were postponed.

    About Pine Labs

    Pine Labs, which was founded in 1998 by Lokvir Kapoor, Rajul Garg, and Tarun Upadhyay, provides complete payment solutions. The services of Pine Labs include online payment gateways and point-of-sale terminals. Currently, it has more than 5 lakh merchants in Southeast Asia, the Middle East, and India. The company’s sponsors include Temasek, PayPal, Mastercard, and Peak XV Partners. Among its rivals are Paytm, PhonePe, RazorPay, and others. After Paytm’s $2.5 billion listing in 2021, Pine Labs’ IPO will be the biggest by an Indian fintech business if it is successful.

    Due to a robust IPO market and a resurgence of investor interest in tech equities, a number of technology businesses intend to go public in 2025. Lenskart, an eyeglasses startup, has contacted investment banks to present for the mandate for its possible initial public offering (IPO), which may raise $1 billion. Groww, a stock broker, had selected five investment banks for a $1 billion initial public offering. In the near future, startups like SoftBank-backed OfBusiness, contract maker Zetwek, and financial unicorn Pine Labs hope to raise $1 billion through initial public offerings (IPOs). Up to 25 firms hope to debut on the public market in 2025.

  • Nuvoco Vistas Gets NCLT Nod for Vadraj Cement Acquisition

    Nirmal Group’s Nuvoco Vistas Corporation has got NCLT’s approval to buy Vadraj Cement. The acquisition is approximated at over INR 1800 crores. It was approved by the Mumbai bench of the NCLT.

    Nuvoco will execute the deal through Vanya Corporation, a fully owned subsidiary of Nuvoco. After the transaction, Vanya will merge with Vadraj Cement, making Vadraj Cement a direct subsidiary of Nuvoco. Nuvoco has said it will fund the acquisition without significantly increasing its existing consolidated debt.

    Strategic Investments to Revive Idle Assets

    Aside from the upfront acquisition price, Nuvoco has earmarked an additional INR 1,200 crore to reinstate and kick-start Vadraj’s operations, which have been dormant for almost seven years. Their operational capacity is expected to roughly triple from fiscal year 2025 to fiscal year 2027, with the facilities being fully online in the first half of fiscal year 2027.

    “The acquisition will be undertaken through Vanya Corporation, a wholly owned subsidiary of Nuvoco Vistas,” said Nuvoco Vistas. “Subsequently, Vanya will be merged with Vadraj Cement, as outlined in the Resolution Plan. After the merger, Vadraj Cement will become the wholly owned subsidiary of the company. A phased investment will be spread over 15-18 months from the date of actual handover by the Committee of Creditors towards getting the facility running and driving operational improvements across the VCL plants. The estimated target date to commence production is around third quarter of fiscal 2027.”

    Vadraj Cement has a 3.5 million tons per annum clinker plant in Kutch and a 6 million tons per annum grinding unit in Surat. Besides that, it has large reserves of limestone. These factors made Vadraj a big target in terms of long-term value for Nuvoco, who was especially focused on the western Indian markets.

    “The captive jetty in Kutch further enhances logistical efficiency. With this acquisition, Nuvoco’s total cement production capacity is set to increase to approx 31 MTPA, consolidating its position as the fifth-largest cement group in India for the long term,” Nuvoco Vistas stated.

    Strengthening Market Position and Operational Synergy

    Upon completing this deal, Nuvoco Vistas will take a step forward in its attempt to emerge as one of the top cement manufacturers in India. The company, according to Managing Director Jayakumar Krishnaswamy, is well-positioned to enhance logistical optimization and competitiveness, as well as to harness key regional market opportunities in the door’s path.

    Nuvoco’s growth strategy is quite simply spelled out in the form of a series of acquisitions that it has done in recent years. Its first major acquisition was that of Lafarge India in 2016. It then went on to acquire Emami Cement in 2020.

  • Zomato’s Relief After NCLT Rejects Insolvency Petition Regarding Alleged Unpaid Debts

    According to reports, the National Company Law Tribunal (NCLT) has granted Zomato relief. NCLT rejected an insolvency petition brought by B2B maker Nona Lifestyle against the foodtech giant for an alleged INR 1.64 Cr in unpaid debts. According to a media report, a panel consisting of Technical Member Reena Sinha Puri and Judicial Member Ashok Kumar Bharadwaj denied Nona Lifestyle’s petition on March 3 to reinstate an insolvency claim that the company had made the previous year. The petition was submitted without the required notice under section 8 of the Insolvency and Bankruptcy Code (IBC). Hence, in the absence of these documents, the court determined that it was not maintainable in and of itself.

    Claims Made by Petitioner Nona Lifestyle

    The petitioner (Nona Lifestyle) claimed that the Deepinder Goyal-led company had fallen behind on payments. Owing to this issue, Nona filed an insolvency plea in October 2024 and asked the NCLT to restore it. Days later, the insolvency case was dismissed. The issue began in 2023 when, in preparation for the ICC World Cup, Nona Lifestyle secured large orders from Zomato. This order was for t-shirts and pants for Zomato’s staff and delivery partners. According to Nona Lifestyle, the business refused to take orders later. In October 2024, Nona Lifestyle first approached the NCLT to begin insolvency proceedings against Zomato; however, the plea was denied on the grounds of non-prosecution. To reinstate the insolvency procedures, the petitioner submitted a second request to the NCLT a month later.

    However, according to the outlined agreement, the petitioner claimed to have fulfilled its promise to manufacture and deliver the articles in parts. But according to Zomato, the manufacturer changed it “unilaterally” and missed deadlines, creating “substantial reputational and goodwill damage” to the business and endangering its World Cup campaign. A B2B platform for procurement as a service, Nona Lifestyle connects manufacturers and suppliers to acquire and deliver industrial goods for a range of industries, including logistics, hospitality, and fast-moving consumer goods. Zomato must be feeling somewhat relieved by the decision, but it still faces additional difficulties.

    Zomato’s Sluggish Growth

    The company’s food delivery division has been growing slowly over the past two quarters of the fiscal year, which ended on March 31, 2024–2025 (FY25). In the second quarter of FY25, Zomato’s gross order value (GOV) for the food delivery company increased by barely 4% on a quarter-over-quarter (QoQ) basis to INR 9,690 Cr. In contrast, the GOV only climbed by 2.3% to INR 9,913 Cr in Q3 of FY25. Additionally, during the assessment period, the company’s transacting user base grew slowly. Its transactional user base increased by only 2% QoQ to 20.7 million in Q2 FY25, while it subsequently decreased by 0.9% to 20.5 million in Q3 FY25. The company’s bottom line was affected by this downturn. Its consolidated net profit fell 57.2% to INR 59 Cr in Q3 FY25 from INR 138 Cr in the same period last year.

  • Glas Trust’s Bid in the Minority Rights Lawsuit Opposed by the Aakash & Manipal Group

    According to reports, Aakash Education Services Limited (AESL) and its majority investors have requested the National Company Law Tribunal (NCLT) to deny Glas Trust’s request to join a lawsuit that aims to prevent the coaching chain from taking away the minority owners’ reserved rights. The coaching division of struggling edtech BYJU’S, private equity (PE) firm Blackstone, and Ranjan Pai’s Manipal Education & Medical Group presented the argument to the tribunal on February 12, according to a media report.

    This occurred during the NCLT’s consideration of a petition from Aakash’s minority shareholders, who assert that the coaching chain is attempting to “remove their rights” and grant special rights to Manipal Education & Medical Group (which holds a 40% stake in AESL). However, since the insolvency-plagued edtech firm is a minority shareholder in Aakash, Glas Trust, which represents BYJU’S’s US-based creditors, wishes to be a party to the case. As both parties (AESL and minority shareholders) had made their cases during the hearing, AESL’s attorney reportedly asked the tribunal to postpone making a decision.

    Argument Presented in Front of NCLT

    The motion was denied by NCLT, which stated that Glas Trust had not yet presented its case. According to reports, Aakash’s attorney, CK Nandakumar, contended that they waited until the session was almost over before saying, “No, no, we have something to say.” They ought to have spoken sooner if they had anything to say. “They have nothing to do with me,” he added. Why are they delaying the hearing on my vacate application if that is the case? Regarding this case, this individual is an absolute stranger.

    According to reports, senior counsel Srinivasa Raghavan, speaking on behalf of Glas Trust, contended that BYJU’s insolvency process would be impacted by the withdrawal of minority shareholder rights because the edtech firm would “lose control” of its lucrative affiliate (AESL). “The representative of Think & Learn (BYJU’S parent) must give their explicit assent to every board resolution.

    Only with the presence of a Think & Learn representative can a quorum be created for each shareholders’ meeting. According to reports, Raghavan stated before the NCLT, “Now, the entire set of articles that control Think & Learn over Aakash is being sought to be removed.”

    Further Argument on EGM

    The extraordinary general meeting (EGM) held by Aakash in November 2024 was also questioned by Glas Trust’s attorney at the hearing, who claimed that the resolution adopted there was void. Citing his justification, Raghavan argued that because the edtech was already in the insolvency process, the promoters of BYJU’S attended the EGM on behalf of Think & Learn rather than the resolution specialist. In response, the NCLT asked Aakash to describe how the resolution was approved despite an unauthorised individual attending the meeting.

    India Must Be at the Forefront of AI Revolution: Sam Altman
    OpenAI CEO Sam Altman emphasizes India’s role in the AI revolution, urging the nation to take a leadership position in artificial intelligence development.
    StartupTalkyNitin Konde

  • The NCLT Approves Zepto’s Reverse Flip into India

    The merger of Mumbai-based Kiranakart Technologies, the company behind the fast commerce platform Zepto, with its Singapore-based affiliate, Kiranakart Pte Ltd, has been accepted by the National Company Law Tribunal (NCLT). Zepto becomes an Indian firm after the NCLT order, and there is no resistance to the two companies’ cross-border merger. Zepto is operated by Kiranakart Technologies Private Limited, an Indian firm, and Kiranakart PTE LTD, a Singaporean holding company. According to the NCLT ruling, Zepto will not need a no-objection certificate (NOC) from the Reserve Bank of India (RBI). According to the tribunal, the RBI has not objected, and an express NOC is not required because the Scheme of Arrangement is covered by Regulation 9 of the Cross Border Merger Regulations, which stipulates that the RBI’s prior permission is presumed. According to the ruling, the scheme will also help the companies deal with better management, value consolidation, risk and policy management, competitive regulatory environments, and shareholder value creation.

    Zepto Aims to Streamline its Group’s Structure with this Move

    Zepto intends to simplify its group structure by lowering the number of legal entities in order to “optimise the legal entity structure” for improved business synergies, speedier decision-making, and substantial cost savings with the move of its holding company to Mumbai, India. This streamlined framework will help future fundraising efforts from Indian and international investors, according to the NCLT Mumbai bench. The judgement further stated that by switching to India, Zepto will be able to control risks, comply with local regulations, and directly align with the regulatory environment. By removing unnecessary administrative tasks and numerous record-keeping procedures, this action also seeks to streamline operations and drastically cut down on common management, administrative, and other costs. Zepto’s preparations for an IPO in India later this year are anticipated to be accelerated by this development.

    Within 30 days, Zepto is anticipated to formally finalise the transfer of its domicile to India. According to an earlier report by Inc42, Zepto, which is financed by Nexus, intends to reverse flip to India. According to people close to the business, Zepto wants to get into the reverse flipping queue with companies like Groww, Razorpay, Pine Labs, and Eruditus. However, many of these unicorns are being cautious and planning the most effective reverse flipping structure, much like PhonePe, whose tax liabilities went up to $900 million. The Mumbai bench of the NCLT noted in its January 9 ruling that the plan seems reasonable and fair and does not violate any legal provisions or public policy. Singaporean officials have also approved the merger.

    Zepto Aiming for an IPO

    In March or April of this year, the fast commerce platform hopes to submit its initial public offering (IPO) draft documents. Prior to going public, the company had already secured the required permits to move its headquarters from Singapore to India. Aadit Palicha and Kaivalya Vohra founded Zepto in 2021, and it presently uses a business-to-business (B2B) business model. Its parent company, Kiranakart Technologies, buys products straight from manufacturers and only distributes them to its licensee businesses, which include Commodum Groceries, Geddit Convenience, and Drogheria Sellers. Last year, Zepto made headlines when it raised an incredible $1.3 billion in capital and surpassed Blinkit and Swiggy Instamart in terms of revenue. At the moment, the rapid commerce unicorn is worth about $1.4 billion.

    Zaggle Partners with Zepto to Deliver SaaS Solutions
    Zaggle inks an agreement to provide Zepto with SaaS solutions, enabling enhanced operational efficiency and technological innovation.
    StartupTalkyNitin Konde

  • BCCI May Petition NCLT to Have Byju’s Bankruptcy Proceedings Withdrawn

    According to media sources, the Board of Control for Cricket in India (BCCI) is expected to petition the National Company Law Tribunal (NCLT), located in Bengaluru, to have its bankruptcy claim against the ed-tech company Byju’s withdrawn.

     It may follow the Supreme Court’s decision last month to overturn the National Company Law Appellate Tribunal’s (NCLAT) October 23 verdict authorising a INR 158 crore settlement between Byju’s (Think and Learn Pvt Ltd) and the BCCI.

     The NCLAT’s previous decision, which had stopped Byju’s insolvency procedures after its agreement with the BCCI, is overturned by this ruling. The Supreme Court incorrectly approved the settlement after concluding that the NCLAT had not followed the procedural guidelines set down in the Insolvency and Bankruptcy Code (IBC). The INR 158 crore that the BCCI had placed in an escrow account will now be moved to an escrow account run by the Committee of Creditors (CoC) as a result of this ruling.

    Supreme Court’s Further Instructions

    According to reports, the court rebuked the NCLAT for ending the Corporate Insolvency Resolution Process (CIRP) too soon. The court further explained that any withdrawal request must be submitted via the Interim Resolution Professional (IRP) rather than by the parties themselves.

     According to reports, Byju’s US lenders have demanded that the Committee of Creditors be reorganised and that the IRP assigned to Byju’s be removed. Arguments in this matter are anticipated to be heard by the NCLT on November 18.

     Byju Raveendran, the founder of the struggling education technology business Byju’s, declared last month that the once-highest valued startup in India now has no value and that the former empire should be rebuilt from the ground up, brick by brick.

    Downfall of Byju’s

    Byju’s was valued at $22 billion in 2022, but its fortunes have declined because of a severe financial shortage, regulatory problems, and investor disagreements. One such dispute involved a fight with US bankers for $1 billion in outstanding debts, which ultimately led to the company’s insolvency.

    “To be successful, I simply need to see a 1% likelihood. The outcome of the court order doesn’t worry me. No matter what, I’ll find a way out.” Raveendran recently informed the media from his home in Dubai that there is no problem in the world that cannot be solved.

    Current Market Dynamics of Edtech Startups in India

    In the last year, over a dozen Indian edtech startups have been bought out, highlighting a difficult funding environment for smaller businesses and causing a wave of consolidation throughout the troubled sector.

    The list of recent deals includes the acquisition of test prep company Ekagrata Eduserv by Google-backed edtech startup Adda247, the acquisition of Housing.com cofounder Advitiya Sharma’s startup Genius Teacher by Noida-based Schoolnet, the acquisition of Doubtnut by Peak XV-backed Allen Career Institute, and the acquisition of Macmillan Learning India by mid-tier IT services company Happiest Minds. According to industry leaders, the fact that smaller businesses frequently provide distinctive offerings and specialise in specialised fields is what is driving the consolidation.

    BYJU’S Faces Legal Challenges: BCCI’s Insolvency Petition Accepted by NCLT
    Explore the latest developments as the country’s education tech giant BYJU’s encounters significant financial and legal issues.
    StartupTalkyNitin Konde

  • NCLT Gives Clearance to Merger Between Slice and North East Small Finance Bank

    Slice, a unicorn in the financial technology industry, has been granted permission by the National Company Law Tribunal (NCLT) to merge with North East Small Finance Bank (NESFB).

    Both businesses made the announcement that they would be merging in October of 2023. In March of the previous year, Slice paid around $3.42 million to purchase a five percent ownership in a bank with its headquarters in Guwahati.

    How Merger Will Help Both the Entities?

    In a news release, Slice noted that the merger will make it possible for the merged business to make use of cutting-edge technology and profound community awareness, which will ultimately lead to increased financial inclusion across the country.

    Customers may anticipate an increased selection of products, improved omnichannel offers, and a banking experience that is more streamlined.

    The scheme of arrangement and amalgamation that involves Garagepreneurs Internet Private Limited, Quadrillion Finance Private Limited, Intergalactory Foundry Private Limited, RGVN (North East) Microfinance Limited, and North East Small Finance Bank Limited has been approved by the National Company Law Tribunal (NCLT).

    The Competition Commission of India (CCI) and the Registrar of Companies (RoC) have both given their thumbs up to Slice and NESFB respective applications.

    In addition, the Reserve Bank of India (RBI) and the Income Tax Department also issued certificates stating that they did not have any objections to the transaction.

    Slice’s Financial Report Card

    Shortly after the conclusion of Slice’s debt round of thirty million dollars, this new development has taken place. The most recent valuation of Slice was above $1.5 billion, which occurred at the Series C round in November 2021. To date, Slice has raised a total of $340 million.

    According to the data intelligence platform TheKredible, Rajan Bajaj, who held the position of CEO and co-founder of the company, owned 8.21% of the ownership.

    While Slice’s losses increased by 59.8% to a total of INR 406 crore, the company’s revenue increased by a factor of three, reaching INR 843 crore in the fiscal year 2023.

    The Bengaluru-based company was able to scale during the fiscal year 23, despite the disruption it experienced as a result of the Reserve Bank of India’s change in rules for card issuers. It has not yet submitted its annual financial reports for the fiscal year 2024.

    About Slice Card

    Slice is a digital lending platform that, in partnership with non-bank financial companies (NBFCs), provides a credit card. The Slice card is intended for individuals who are new to the concept of credit, as well as students and young professionals who have their finances limited.

    There is no requirement for a credit score, and the eligibility requirements are more lenient. There is also no annual charge or membership cost associated with the card.

    Fintech Takeaways from Slice-North East Small Finance Bank Merger
    In this article, we explore how fintech companies can lay the foundation and prepare for a probable merger-like scenario with a bank in the future.
    StartupTalkyPrithvi Durai