National Asset Reconstruction Company Limited (NARCL) has offered lenders base bids for the bad loan accounts of Hitodi Infra (Hitodi Infrastructure Ltd), Sion Panvel Tollways (Sion Panvel Tollways Private Limited) and Morarjee Textile (Morarjee Textiles Limited) with total consolidated debt of more than INR 40 billion. Based on binding bids from the government-backed bad bank, lenders have initiated a Swiss challenge auction for Hitodi Infra. The lenders, including Bank of Baroda Limited (NSEI:BANKBARODA), ICICI Bank Limited (NSEI:ICICIBANK), Axis Bank Limited (BSE:532215), Bank of India Limited (NSEI:BANKINDIA), IDBI Bank Limited (NSEI:IDBI) and State Bank of India (NSEI:SBIN), have appointed BoB Capital (BOB Capital Markets Limited) as the process advisor.

NARCL has offered INR 4.65 billion for the outstanding loans of INR 21.01 billion. The lenders have asked bidders to either bid in all cash or on a cash-and-security receipt basis. NARCL buys debt under a 15:85 structure where 15% is paid in cash and 85% in security receipts.

The minimum markup will be 5% of the anchor bid. The Swiss auction will be held on March 26. Security receipts are instruments issued by asset reconstruction companies for purchase of stressed debt and show the interest in the underlying assets.