S.A.L Steel takes $7.81M Kotak term loan to repay inter-corporate deposits
What's the deal? S.A.L SteelDealroom has a profile for this one. Try Dealroom → has availed a US$10.2M term loan from Kotak Mahindra BankDealroom has a profile for this one. Try Dealroom →, primarily to part-repay Inter-Corporate Deposits (ICD) held with AIA EngineeringDealroom has a profile for this one. Try Dealroom →. The facility carries a 10% interest rate and a 60-month repayment tenure.
Why now? The transaction follows the bank's sanction letter dated September 29, 2026. Alongside the new loan, the company renewed existing working capital facilities of US$6.65M, bringing total aggregate exposure to US$16.8M.
What's the endgame? The borrowing shifts S.A.L Steel's funding from inter-corporate deposits to bank debt. The facility is secured through hypothecation of the company's entire current assets and all movable fixed assets at its plant in Gandhidham, Gujarat.
The loan is also backed by personal guarantees from Mahesh Kumar Agarwal and Kaustubh Agarwal, while a corporate guarantee from Sree MetaliksDealroom has a profile for this one. Try Dealroom → remains valid for the facility's tenure.
What could go wrong? The 10% borrowing cost will shape the company's weighted average cost of capital and interest coverage in coming quarters. The security package excludes assets exclusively financed by other banks or financial institutions.
S.A.L Steel disclosed the development under Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. Kotak Mahindra Bank holds no shareholding in the company, the transaction is not a related party transaction, and no shares were issued.
The signal: Mid-cap manufacturers are increasingly swapping informal inter-corporate funding for structured bank debt — a move that trades flexibility for clearer, secured terms.
Read more: scanx.trade
Image credit: Shook Photos
