As the coronavirus unleashed havoc on the UPL Ltd stock, the company reassured investors twice last month. First, on 14 April, UPL said all its manufacturing plants were functioning and demand for crop protection products remained strong.
In most countries, its products are classified as essential commodity. Last week, UPL said its net debt is projected to drop from $3.8 billion in March 2019 to $2.9 billion by March 2020-end.
This implies $900 million in repayment for FY20. Note that in February, a UPL unit issued perpetual subordinated capital securities (bonds) of $400 million at a coupon rate of 5.25% per annum.
Accounting standards stipulate that perpetual debt is classified as equity. Adjusting for this, the debt reduction is within