* Stock falls as much as 22.4 percent
* HDIL exec says "very comfortable" with debt repayments
(Updates with details, background)
By Aditi Shah and Swati Pandey
MUMBAI, Jan 24 (Reuters) - An executive at India's Housing
Development & Infrastructure Ltd, whose shares have
plummeted on market speculation over its debt repayments, denied
on Thursday it was in financial trouble.
The company's share price tumbled anew by 22.7 percent after
already falling 20.4 percent in the previous two sessions.
The losses, triggered when the company said its vice
chairman and co-founder cut his stake by more than half, has
wiped 19.5 billion Indian rupees ($363.23 million) from HDIL's
"There have been lots of rumours in the market about
bankruptcy and defaults, which we totally deny," said Hari
Prakash Pandey, vice-president of finance at HDIL, on a
conference call with investors.
"We are very comfortable with the debt repayment schedule
and we are as per schedule," he added.
The fall in HDIL's share price highlights concerns about the
high debts at property developers, which are facing trouble
paying back interest at a time of slowing sales.
HDIL was also hit by worries about the widespread practice
of so-called promoter pledging in India, in which controlling
stakeholders of companies pledge their shares as collateral in
exchange for loans or working capital.
Vice Chairman Sarang Wadhawan sold 5 million shares worth
570 million rupees, reducing his stake to 0.99 percent from 2.19
percent, HDIC said on Tuesday.
The company is 37 percent owned by its founders including
Wadhawan, with 98 percent of their shares pledged with banking
and financial institutions.
Pandey said Wadhawan sold his stake because the company had
to meet immediate debt and principal repayments, as well as a
final tranche of the payment for a land transaction in Mumbai.
"We took certain decisions which have not gone down very
well with our shareholders, and the promoters have assured that
there will not be any further sale of shares," Pandey said.
A slowdown in home sales in Asia's third largest economy,
caused by sticky inflation and high interest rates, is putting
pressure on property developers who loaded up on debt during
India's real estate boom of 2006/07.
Pandey said HDIL faced an average cost of debt of 13.25
percent and is trying to manage its debt through cash flow and
extending the maturity of loans. Its debt is down 2 billion
rupees to 34.7 billion rupees as of the end of December.
Other property developers also fell on worries about their
debts, with Unitech Ltd losing 7 percent.
Infrastructure developer IVRCL Ltd slumped 19.8
The tumbling of HDIL shares also reflects concerns about
promoter pledging. Large stake sales by controlling stakeholders
in companies thought to be facing financial difficulties often
lead to a bout of selling.
Dealers fear that this kind of sellings can herald cash
problems for either the controlling stakeholder or the company.
The total value of pledged stocks reached $27 billion as of
the quarter ended in September, according to Morgan Stanley,
marking a 16 percent increase from the previous quarter.
($1 = 53.6850 Indian rupees)
(Additional reporting by Abhishek Vishnoi; Editing by Rafael
Nam and David Cowell)