Shares of Reliance Power Ltd moved higher in Tuesday’s trading session after the company’s promoter, Anil Ambani, wrote to Finance Minister Nirmala Sitharaman seeking a time-bound and structured settlement of outstanding bank dues. The stock was trading at ₹21.38 on the NSE, up ₹0.41 or 1.96%, reflecting positive investor sentiment following the development. In a letter dated March 17, Ambani requested the government to consider a structured resolution mechanism for the group’s outstanding loans with banks. He cited the precedent set in the case involving the Sandesara family, promoters of the defunct Sterling Biotech Ltd, where authorities pursued a structured settlement of dues. Ambani proposed the constitution of a high-powered committee of independent legal and financial experts to consolidate what he described as a “pure commercial matter” between lenders and borrowers involving his companies.
The letter was placed before the Supreme Court of India on Monday as part of a supplementary affidavit filed by Ambani in a ₹40,000-crore bank loan fraud case. In the Sterling Biotech case, the Supreme Court had in November last year agreed to drop criminal proceedings against the Sandesara brothers if they deposited ₹5,100 crore with the court’s registry by December 17, approving a structured institutional settlement. Ambani, however, sought to distinguish his case from that of the Sandesara family. He argued that if a structured resolution was achievable in far more adverse circumstances involving individuals declared fugitives and residing outside India, a similar framework should be pragmatically and legally possible in his case as well. He pointed to what he described as a “clear precedent” in the Sterling Biotech resolution, where no penal or overdue interest was charged and the principal dues were crystallised and subjected to a mutually negotiated one-time settlement.
Ambani’s letter also highlighted the financial challenges faced by the Anil Dhirubhai Ambani Group, noting that around ₹15,000 crore worth of group assets have been seized. He said the group had been impacted by two major systemic crises — the collapse of India’s telecom sector following the Supreme Court’s judgement in the 2G Spectrum Case in 2012, and the liquidity crisis triggered by the collapse of Infrastructure Leasing & Financial Services (IL&FS) in 2018, which caused a sector-wide funding freeze across NBFCs and housing finance companies. Market participants viewed the development as a potential step toward financial restructuring and improved balance sheet visibility, which supported buying interest in Reliance Power shares during the session. Investors are likely to closely track the government’s response and further developments regarding the proposed settlement framework.