ARCIL names ITCOT as resolution agent Saturday, 08 May , 2004, 09:52 ARCIL has appointed the Industrial and

Technical Consultancy Organisation of Tamil Nadu (ITCOT) as its resolution agent for recovery of bad loans in Maharashtra, Gujarat and Goa. ARCIL is the first asset reconstruction company (ARC) in India and is promoted by SBI, ICICI and IDBI. Asset reconstruction companies take over bad loans from banks and financial institutions, create a market for such assets and enable a clean-up of non-performing assets (NPAs) in the system. NPAs were estimated at Rs 1,06,000 crore in March 2004. Loans from SBI and State Bank of Hyderabad worth Rs 55 crore (total outstanding dues from borrowers at Rs 145 crore) was the first portfolio that ARCIL outsourced to ITCOT. These loans cover various industry segments, including textiles, chemicals, pharmaceuticals, leather and engineering. S.V. Venkatakrishnan, Vice-President and Group Head-Asset Resolution, ARCIL, said the institution had acquired assets worth Rs 7,000 crore from 116 borrowers in the eight months of operation up to March 31, 2004. The company was likely to double its acquisition during the current year, he said. ARCIL will also enter into more outsourcing arrangements to speed up the recovery process, given its ``lean'' structure, Venkatakrishnan said. The organisation has 33 persons on board, including 11 on deputation from the main stakeholders. Venkatakrishnan said new shareholders would be added as the company proposed to increase its capital base to Rs 100 crore from Rs 25 crore. V. Krishnan, Managing Director, ITCOT, said, as per the agreement, they were given 12 to 18 months time for recovery and would be given a performance-based incentive. ITCOT plans to set up an office in Mumbai to handle this assignment. Krishnan said there had been a number of enquiries from banks for

assistance in taking possession and sale of assets under the SARFAESI (Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interests) Act. ITCOT had assisted ICICI Bank in the Mardia Chemicals case. Non-Performing Assets ARCIL proposal to RBI Allow banks to amortise NPA sale provisioning Poornima Mohandas The recommendation, if implemented, is expected to greatly benefit debt-ridden institutions such as IFCI, IDBI and Global Trust Bank. Mumbai , June 16 THE Asset Reconstruction Company of India Ltd (ARCIL) is pushing the Reserve Bank of India to give incentives to banks that sell bad assets to asset reconstruction companies. ARCIL's recommendation to amortise additional provisioning on sale of assets to asset reconstruction companies is expected to specifically help the relatively weaker banks and financial institutions. "We have requested that banks and FIs be given an incentive by way of a one-time window to amortise provisioning while selling bad loans to asset reconstruction companies (ARCs). Not all banks / FIs will be able to take the knock of additional provisioning mandated on sale to ARCs in a single year. Banks should be allowed to make the provisions over a three year period," said Mr Rajendra Kakker, MD & CEO, ARCIL. ARCIL has already sent a written suggestion to the central bank in this regard and is awaiting a response. The recommendation, if implemented, is expected to greatly benefit debt-ridden institutions such as IFCI, IDBI and Global Trust Bank. While IDBI has sold several hundred crore of bad assets to ARCIL, IFCI has just received board approval for the same. Global Trust Bank, although starved of capital, reportedly has plans to sell as much as Rs 500 crore to ARCIL. An amortisation of provisions will make the process easier for the private bank with its capital adequacy nil, said an analyst.

ARCIL has suggested to RBI that a window be opened up on a temporary basis through which banks / FIs can carry out provision over a three-year period as against the current mandatory norm that the entire provisioning be carried out in the year of asset sales itself. The provisioning needs for banks to conduct asset sales to an ARC works like this: Say, a bank has a bad outstanding loan of Rs 100. It has provided for Rs 50 and desires to sell the loan to an ARC - if the ARC offers a price of Rs 20 for the loan, then the bank, as per current norms, is to provision for the additional Rs 30 in the same year as that of the asset sale. The new proposal suggests that the provisioning be spread over three years (i.e., to provide at the rate of Rs 10 every year for three years) to reduce the dent it creates in the bank's profitability. Bankers say the move will certainly help the weaker institutions, which do not have strong balance sheets or hefty profits. ARCIL likely to start operation in mid July July 01, 2003 15:41 IST

The Asset Reconstruction Company of India Ltd, promoted by the State Bank of India, ICICI Bank, Industrial Development Bank of India and other banks, is slated to start operation by the middle of this month. The SBI is also awaiting the amendments in the banking secrecy laws to flag off the Credit Information Bureau of India Ltd, its chairman A K Purwar told PTI in New Delhi on Tuesday. While CIBIL would provide vital information about the companies approaching banks for loans and reduce the risks of defaults, ARCIL would assist in the speedy recovery of sticky assets and clean up the balance of banks and financial institutions. "ARCIL will start operations in July," Purwar said, adding the company was awaiting the approval of the Reserve Bank. Initially, SBI along with IDBI and ICICI Bank decided to promote ARCIL with 24.5 per cent stake each. Later they decided to recast the equity holding structure and ia likely to hold a little less than 20 per cent in ARCIL, slated to start operation

with the non-performing and stressed assets worth Rs 7,000 crore (Rs 70 billion). The ICICI Bank, SBI and IDBI decided to shed a portion of their pies in order to rope in more number of banks including the Bank of India, Bank of Baroda and the UTI Bank. ARCIL was registered last fiscal with an initial capital of Rs 10 crore (Rs 100 million). ARCIL would create a trust, which would float mutual funds after getting the necessary nod from the Securities and Exchange Board of India. The legal documents for transfer of assets, identification of assets to be taken up, and other things have been put in place. Initially, ARCIL would take up stressed assets of ICICI, IDBI and Industrial Finance Corporation of India. The non-performing assets of banks are mainly on account of the failure to repay working capital loans and would be taken up gradually. In the first batch, NPAs worth Rs 5,000-7,000 crore (Rs 50-70 billion) have been identified and a roadmap has been worked out. ARCIL has classified the NPAs in four groups. Group-I assets would be the NPAs of those companies where there is no need to change the promoters and loans could be restructured. The Group-II NPAs would be those where the ARCIL believes that the company can be merged with another entity. In the case of Group-III assets, the unit can be made viable through the change in management. If necessary, an employee stock option scheme would be worked out for the new management as an incentive for reviving the unit. In the case of Group-IV assets, ARCIL would proceed to the liquidation of the company. The ARCIL comes after the passage of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Bill in Parliament's last session. Apart from allowing the setting up of the ARCs, the Bill also empowers banks to take possession of assets of the defaulting companies after a period of time.

The ARCs would takeover the assets of banks and FIs and make its own efforts to recover the bad loans while cleaning off the balance sheets of banks. The banking sector hopes to reduce the NPAs worth over Rs 1,10,000 crore (Rs 1,100 billion) by at least 20 per cent in a year through the implementation of securitisation laws and ARCs

ITCO ITCOT was incorporated in 1979 as a joint venture of leading Financial Institutions, State Development Corporations and Commercial Banks to provide consultancy services to industry and services sectors. We offer a wide range of consultancy services such as project identification, project profiles, project reports, market surveys, technoeconomic feasibility studies, detailed project reports, project management, escort services, project appraisals, asset valuation, stock audit, sick unit rehabilitation, restructuring, skill upgradation programmes, industry specific studies, energy audits, environment impact assessment, computer training programs and so on. We also undertake turnkey projects on wind mills, co-generation in sugar and paper mills, diesel captive power plants and solar energy projects. We organise seminars, training programs and industry meets on current topics. The services are offered to corporate, small and medium enterprises, individual entrepreneurs, public sector undertakings, banks, financial institutions, cooperatives and governments. We have a talented and experienced pool of professionals in agriculture, textiles, chemicals, engineering, software, energy, management and other disciplines.

Our Promoters Our Associates

Our Promoters Our promoters are: All India Financial Institutions:

ICICI Bank Ltd. Industrial Development Bank of India (IDBI) IFCI Ltd.

State Development Institutions:

State Industries Promotion Corporation of Tamilnadu Ltd. (SIPCOT) Tamilnadu Industrial Investment Corporation Ltd. (TIIC) Tamilnadu Small Industries Development Corporation Ltd. (SIDCO)

Commercial Banks:

State Bank of India Bank of Baroda Canara Bank Union Bank of India Syndicate Bank Central Bank of India Indian Overseas Bank Indian Bank The Lakshmi Vilas Bank The Karur Vysya Bank

Our Associates Strategic Tie-Ups/Alliances/MoUs We have Strategic alliances/MoUs with:

Indian Renewable Energy Development Agency Ltd. (IREDA), New Delhi Ministry of Non-Conventional Energy Sources (MNES), Govt. of India Aruvi Engineers, Chennai Shramir Consultec, Chennai Computer Software College (CSC), Chennai

Empanelled Retainers We maintain a panel of experts from specialised disciplines for special and occasional reference on retainer basis. Register Here DEBT RECOVERY NPA is a growing source of concern for lending institutions and banks. With non-performing assets mounting by the day and assets turning bad, it is important to dispose and recover to help improve the bottomline. Attempts are being made through policy changes, employing novel strategies for recovery, using judicial and non-judicial methods to salvage as much as possible. Equipped with vast techno-commercial expertise in fair market valuation, excellent contacts with the industry, trading community, and overseas investors, ITCOT assists some of its promoter organisations in just doing that and with a great degree of success. It conducts valuation of assets and strategises the sale of assets at the best realisable prices. ITCOT's mission is to help clients to quickly convert assets to cash within the shortest possible time. ITCOT also provides in-house training programs to drive home the message of "Importance of Recovery" from the lowest level of an organisation to the topmost level. Some of our services include: 1. 2. 3. 4. 5.

Inventory and Valuation of assets Drafting of Documentation necessary for sale Strategy reports for sale of assets Act on behalf of Judiciary as Commissioner and Receiver Due diligence and delivery of assets Inventory Valuation Sale & Disposable of Assets .

Inventory We carry out assignments on inventory of fixed assets and current assets(stock audit) too on behalf of financial institutions, banks, corporate and any secured creditor in India. We have multi-disciplinary expertise to carry out such assignments. Generally we verify, and inspect the assets with reference to information that is available within

and outside the organisation. After careful assessment of the assets are done, we add value to the assignment by bringing our expertise in grouping the assets to saleable lots with great appeal to the buyers. Top Valuation Valuation of assets are carefully done giving due importance to crucial factors like age of the fixed asset, present condition, future life, replacement value, depreciation, technological obsolescence, damaged caused while not in use, and the market value. Valuation reports for fixed assets and current assets are prepared for the benefit of both the buyer and the seller of assets. Top Sale & Disposable of Assets ITCOT has closely worked with several financial institutions, banks, and corporates in effecting sale and disposal of NPA's to their satisfaction. Our multidisciplinary expertise and pro-active approach has brought value and satisfaction to our customers. We help our clients with complete documentation by preparing information manuals, bid documents, locating prospective buyers and developing strategies for shortening the "asset to cash" cycle. Consultancy Services Do you want to start an enterprise, expanding an enterprise, supporting entrepreneurs or entrepreneurship, requiring prudent advice regarding a business or diversifying your present business? Several individuals, corporate, public and private sector organisations have hired our consulting services for finding a solution to their problems. We bring exceptional combination of talent, skills, resources and expertise into the planning process. Our range of services include

Market Research Project Identification Techno Economic Feasibility Report (TEFR) Modernisation/Technology Upgradation Studies Sick Unit Studies Due Diligence Studies

Restructuring & Rehabilitation

Market Research Market Surveys are undertaken to explore market potential for products and services. Market research is a cost-effective way of finding out what customers believe, think, want, need or do. It deals with information that cannot usually be obtained from any other source. Industry, commerce and Governments use research to help them produce goods, services, and policies matched to the needs of the customers. With growing competition in the market place, market research has become thesine qua non for corporate houses, small and medium enterprises, industry and trade associations and even individual entrepreneurs. Market research is as important to Governments as to industries. For instance, trade promotion agencies need to carry out market research to formulate their promotion programmes and policies. Any industrial development institution needs to rely on market research to direct its credit flow into sectors that hold promise for devleopment. Similarly, planning bodies, Banks, Finance corporations, and other development agencies rely on market research to formulate their policies and programmes. Project appraisals by institutions and Banks draw heavily on market research techniques to take a final decision on project financing. In brief, market research helps Governments and Government agencies to identify areas of priority for investment promotion, export promotion, regional development and to assess the impact or success of their policies and programmes. ITCOT has undertaken over 1000 market surveys exclusively on behalf of clients. Market surveys can be undertaken by ITCOT anywhere in the country and abroad. The surveys can be tailor-made to study market potential in specific locations, districts, states, regions etc. based on the project scope. These are futher highlighted below:

Industrial Potential Survey Export Market Assessment Market Appraisal . Market Research - Primary & Secondary

Industrial Potential Survey

We undertake industrial potential surveys to survey the industrial potential in specific geographic areas based on infrastructure facilities, raw material resources, entrepreneurial quality, linkages, and such other factors. Financial institutions, banks and other development agencies frequently resort to such surveys to stimulate investment in specific areas. Top Export Market Assessment Primary and secondary market research is carried out to gather details such as trend in world production, trend in exports, imports, world consumption; market shares of countries, and in price realisation; trade direction; trade concentration; emerging markets; foreign trade policy in major countries; major exporters and importers; quality standards; scope for exports; trade agreements; barriers to entry; impact of globalisation; major relevant international institutions; and so on. Top Market Appraisal A market appraisal forms part of an overall project appraisal and could be based on an in-depth primary market survey or a quick market survey based on few market inquiries and discussions. Such appraisals are done by financial institutions and Banks on project proposals submitted by entrepreneurs seeking financial assistance. When the proposals are accompanied by detailed survey reports prepared by the entrepreneurs or by consultants on their behalf, market appraisals may be supportive in nature to confirm the findings in the submitted report. The financial institutions may call for a detailed market appraisal if the project proposal is not adequately supported by market survey reports. Top Market Research - Primary & Secondary Primary market surveys are extensive in nature and highly focused on specific aspects such as structure of industry, installed capacity, product specifications, trend in production, exports, imports, government policy, global scenario, impact of globalization, quality standards, competition, market leaders, brand loyalty, brand

monopoly, market shares, packaging practices, trade practices, prices, price sensitivity, demand growth, demand and supply gap, market segments, niches, marketing strategy, and so on. These surveys are based on information gathered on structured questionnaires and unstructured discussions with representative cross-section of manufacturers, intermediaries, and knowledgeable sources. Appropriate sampling methods are used for the surveys. Primary surveys are undertaken to gather first hand information from respondents whereas secondary survey or desk research is undertaken mostly as a preliminary to in-depth primary surveys. We undertake secondary research when clients need only secondary statistics or information. Top Project Identification The first step in starting a business is to identify a business opportunity. It is also often the most critical task for a first generation entrepreneur. Be it an organisation or an individual, identifying a profitable business is long drawn out process that involves evaluating ideas before a final decision. ITCOT helps indviduals and companies to identify profitable business opportunities. A large number of ideas are gathered everyday and shared with prospective entrepreneurs and enterprises through a selection process to narrow down to a profitable business opportunity. Top Project Report and Techno Economic Feasibility Report Techno Economic Feasibility Report (TEFR) is prepared to give shape to a project idea and make assessment of market potential, technical capabilities needed, arrive at the project capacity, project location, infrastructure, manpower and quality control needs. TEFR will highlight techno economic feasibility of a new project or expansion project or modernisation project along with estimation of project cost, means of finance, profitability projections, financial indicators and sensitivity analysis. TEFR will cover market, technical and financial aspects pertaining to a project. TEFR is prepared for new projects, expansion schemes and substantial modernisation of existing facilities and particularly, when the project needs funding from institutions and banks.

ITCOT also undertakes appraisal of projects and TEFR's prepared by a client for an unbiased and neutral opinion. ITCOT has prepared more than 1000 TEFRs in all major industry verticals for small, medium and large units. Top Modernisation/Technology Upgradation Studies These studies are generally in the form of technical appraisal of schemes proposed by business units. Before taking a decision on providing term loan facilities, banks and Financial Institutions refer the modernisation/technology upgradation schemes to ITCOT for a detailed analysis of investment and expected benefits of modernisation. ITCOT has prepared a large number of modernisation studies based on reference from Industrial Development Bank of India (IDBI) and state financial institutions like State Industries Promotion Corporation of Tamilnadu Ltd. (SIPCOT), Tamilnadu Industrial Investment Corporation Ltd. (TIIC) and banks. These studies are also carried out for specific government schemes like Technology Upgradation Fund (TUF) scheme. ITCOT provides specialised services to help analyse and evaluate the need for modernisation and its intended benefits. Top Sick Unit Studies ITCOT is often referred to by Banks and FIs for preparationof detailed viability studies on unites which become sick or which are on the urge of sickness. These studies include diagnostics of past and present operational & financial performance, SWOT analysis, market prospects, suggested business plans, and proposed rehabilitation scheme for the consideration of Financial Institutions, Banks and Government. ITCOT has carried out a large number of sick unit studies for small, medium and large industries. For the Board for Industrial and Financial Reconstruction (BIFR) referred companies based on appointment as consultants by operating agencies like banks and financial institutions, ITCOT has prepared several techno economic viability studies. Large public sector organisations of the Governments in Tamilnadu and elsewhere have utilised the services of ITCOT in the fields of engineering, sugar, etc.

Top Restructuring & Rehabilitation ITCOT provides advisory services in helping to restructure and develop rehabilitation packages. Closure of business units or strategic sale of divisions of corporate are also considered as an option wherever necessary. Operating agencies like the ICICI Bank avail of support services offered by ITCOT. Top Due Diligence ITCOT has a wide exposure to a large number of industries and has several man-years of expertise and experience. Our business associates and large number of experts in different parts of the country enable us to undertake due diligence studies for individual units or companies whenever mergers, take-overs, spin-offs or similar options are considered as part of business restructuring. With specialists in legal, technical and financial areas, ITCOT ensures fixation of fair purchase consideration and adequate safety measures in implementation of these schemes. While most due diligence studies generally concentrate on legal, financial and procedural aspects of the business, ITCOT emphasizes on techno commercial aspects in mergers and acquisitions for business continuity. Due diligence reports are prepared on behalf of the proposed buyer or seller of the business. In either case complete transparency and unbiased evaluation are assured. The prices are inclusive of 8 % service tax. The payments are to be made by demand draft in favour of ITCOT Ltd., payable at Chennai. Postage is free if posted to the addressee in India. All reports will be sent by Registered Mail or by courier. Please allow a week for delivery. Title of the publication Report on Opportunity in Export Oriented Projects Techno economic Guideline Report on Hotel Industry Report on Jatropha (Fuel of the Future) Report on Bamboo (A Multipurpose Agro Forestry Crop) Price Rs.3240. 00 Rs.4320. 00 Rs.3780. 00 Rs.3240. 00

Rs.8100. 00 Opportunities in Food Processing Industry - Forty Project Rs.8640. Profiles 00 Rs.9720. Report On Ductile Iron Pipes 00 Rs.6480. REPORT ON BUSINESS PROCESS OUTSOURCING (BPO) 00 Feasibility Report on Fast Food Restaurants:(Pure Vegetarian Rs.1944. & Multi-Cuisine) 00 Rs.3240. Report on Cold Storage Projects 00 Rs.6480. Report on Ethanol 00 Rs.3240. Investment Opportunities in Wasteland Development 00 Rs.4320. Opportunities in Herbal Medicinal & Aromatic Plants 00 Investment Opportunities in Hotel Industry in Chennai - A Rs.8100. Market Survey & Feasibility Study Report 00 Rs.4320. Business Opportunities in Digital Entertainment 00 Rs.3240. Report on Bottled Pure Drinking Water 00 Rs.2160. Report on Organic Foods 00 Rs.1620. Publication on Project Profiles related to Waste Utilisation 00 Rs.5400. Report on Call Centre 00 Rs.4320. A Feasibility Report on Ayurvedic Medicines: With GMP Details 00 Rs.2160. Industrial Enzymes Potential and Opportunities 00 Report on Biodegradable Paper Bags, Paper Cups and Jute Rs.3240. Bags 00 Rs.5400. Report on IT Enabled Services 00 Rs.5400. Report on Medical Transcription 00 Rs.2700. Business Opportunities in Stainless Steel Based Products 00 Business Opportunities in Non-Ferrous Metal Products Rs.3240. Opportunities in Health Care

00 Opportunities in Engineering Exports - Iron and Steel Based Rs.3240. Products 00 Rs.2160. Report on Ready Mix Concrete 00 Report on E-Commerce & M-Commerce: An E-Business Guide Rs.5400. for New Economy Entrepreneurs 00 Project Opportunities in Leisure and Entertainment Business: Rs.6480. Family Entertainment Center 00 Project Opportunities for Investment in Organized Retail Rs.5400. Consumer Market in India 00 Report On Cultivation & Processing of Baby Corn, Mushroom, Rs.2700. and Gherkin 00 Rs.3240. Fortune in Chemical Industries 00

Our Old Publications Report on Bioinformatics - Small and Medium Investment Venture Capital - A Boon for IT Enterpreneurs Application Service Provisioning: Usage and Practice Report on Starting a Private Insurance Company A Report on How to Setup and Achieve Success in COMPUTER GRAPHICS & MULTIMEDIA (CG & M) Guidance Report on Starting Dot Com Business Report on CKD Wooden furniture project- A Feasibility Report Home RBI may not accept Arcils proposal Friday, 02 July , 2004, 14:02 In a move to enable banks and financial institutions (FIs) clean up their balance sheets in an efficient manner, the Asset Reconstruction Company of India (Arcil) has proposed to the Reserve Bank of India (RBI) to spread out the provisioning of losses that occur due to the sale of bad assets to asset reconstruction companies.

Arcil had requested RBI to allow weak banks and FIs to carry out the provisioning process over a 3-year period. This would enable banks and FIs to make provisions for nonperforming assets (NPAs) a lot easier. According to the current norms the asset reconstruction company will pay a fair value to the bank when the bank affects a sale. The bank is then required to provide for the difference in the actual value and the fair value in the same fiscal. According to known sources, it is unlikely that RBI will take up Arcils recommendations. Arcil that has been operating for a year now has assets worth Rs 9,000 crore at a fair value of Rs 1,600 crore. Arcil is now into the process of resolution of assets on a case-to-case basis. ARCIL seeking a gateway for FIIs in distressed assets Poornima Mohandas Mumbai , June 11 The Asset Reconstruction Company of India Ltd (ARCIL), India's first asset reconstruction company, has approached the Government for permitting FIIs to invest in a new instrument in India distressed assets. ARCIL has made representations to SEBI, RBI and the Finance Ministry to allow FII investment in a new category, which is neither equity nor debt but a separate instrument - security receipts with underlying distressed assets. "We have made representations to the regulators and the response from them has been encouraging," said Mr Rajendra Kakker, Managing Director and CEO of ARCIL. Several FIIs such as GE, Citicorp, Clear Water, Merrill Lynch and Morgan Stanley are waiting at the doorsteps to enter this yet-to-be-developed market for distressed assets in India. Currently there are two instruments that FIIs can invest in India i.e., equity and debt. The cap on FII debt investment varies from time to time between $1.0 billion and $1.5 billion. "We don't want FII investment in distressed assets to be limited due to any cap; therefore, we want another window for investment in it," explained an ARCIL official.

ARCIL officials are, however, unsure when the approvals are likely to come through. The security receipts market, or the junk bond market as it is called in many developed and developing countries, works like this - A bank/FI sells a bad loan to ARCIL which floats a security receipt to represent it. These receipts can be subscribed to by investors such as FIIs and even be traded. In a year's time ARCIL is slated to arrive at NAVs for these instruments. Currently in the absence of FIIs as investors, the banks/FIs, which sold the bad loans themselves are subscribing to the security receipts. These security receipts will have a face value of Rs 1 lakh and will have no fixed obligation or interest component attached to it as is the case of a `pass through' certificate. The returns will be dependent on the NAV, which will be based on the resolution of the borrower account. So if there is an economic or specific sector-wise upturn and the borrower turns a good repaying one, the NAV will rise and the amounts recovered will be paid to the receipt holders in the form of dividends. Currently ARCIL has acquired 116 cases with principal outstanding assets of Rs 3,089 crore from SBI, IDBI, ICICI Bank, Punjab National Bank among others. ARCIL's acquisition was made through the floatation of security receipts worth Rs 1,600 crore which were subscribed to the selling banks themselves. Therefore, for the time being, from the banks' point of view, the bad assets have merely moved from the advances book to the investment book in `standard non-SLR' category but with the burden of provisioning and the cost of the receipts itself. Court route `best' for asset seizure N.S. Vageesh

CHENNAI, Jan. 10 APPROACH the courts/district magistrates to appoint a commissioner to take possession of assets, is the advice that Mr V. Krishnan, Managing Director, Industrial and Technical Consultancy Organisation of Tamil Nadu (ITCOT), has for banks and financial institutions engaged in the task of seizing assets and recovering dues from defaulters. ITCOT, a project advisory and consultancy organisation, has also conducted a number of rehabilitation and recovery operations in the past few years. Although the new Securitisation Bill provides the room for lenders to act directly, the judicial stamp to the recovery process enhances the negotiating position of the lender, says Mr Krishnan. Even the most recalcitrant of borrowers is diffident when it comes to defying a court order on handing over custody of assets. Taking possession of the assets (or whatever that is left) is no mean task as some of Mr Krishnan's assistants, who had recently been to Ahmedabad to take custody of the Mardia Chemicals unit at the behest of ICICI, will gladly testify. The first hurdle in the case of any possession attempt is labour - workers who are often out of jobs for months and are keeping a wary eye out for any sign of revival/or sale of plants. Countering their gheraoing, sloganeering, dharnas, fasts and some occasional attempts at self-immolation with patient listening and explaining of their role, challenge the spirit and nerves of many recovery officials. But taking possession is only the beginning of a long haul that encompasses, taking inventory of the plant/machinery and stocks, its valuation, advertising for finding suitable buyers, preparing documents, arranging for inspections, convincing buyers as well as militant trade unions and finally effecting the sale of assets, says Mr Krishnan. Selling the assets is the difficult part. Having realised over Rs 20 crore through sale of assets in the past three years through half-a-dozen assignments, he is acutely aware of the pitfalls in the process. He says that it takes eight months on the average, from the time they are given a mandate to take possession till the time the sale is made and amounts recovered. He however refuses to hazard a guess on how much can actually be recovered under the new law by banks and financial institutions, some of which are approaching his organisation for help.