Cox & Kings Defaults On Debt Again
Passengers carry their baggage in the departure lobby at Haneda Airport in Tokyo, Japan. (Photographer: Akio Kon/Bloomberg)

Cox & Kings Defaults On Debt Again

Cox & Kings (India) Ltd. failed to repay debt on time a second time in less than a week as the tour operator faces a cash crunch.

The company defaulted on Rs 50 crore worth of unsecured commercial paper repayment to two investors due on June 28, it said in an exchange filing. Of the Rs 65-crore payable, it could pay service Rs 15 crore.

Cox & Kings cited a cash-flow mismatch, exacerbated by rating downgrades for the default. CARE Ratings and Brickworks Ratings lowered the company’s ratings several notches to default after it failed to repay Rs 150 crore due on June 26.

The company said its working capital was stretched and further aggravated because of its inability to replace short-term loans with long-term debt. The company is taking all required measures to resolve the temporary cash flow mismatch. While evaluating operational performance, the company said it’s also approaching lenders to work out some time-bound programme to meet this emergency.

The defaults are surprising as the latest financial statements show Cox & Kings has a cash balance of Rs 1,860 crore. But the breakup could not be ascertained as the last fiscal’s annual report is yet to be filed. The company didn’t respond to BloombergQuint’s earlier queries on its cash balance.

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