What happened at DHFL in 2019?
Dewan Housing Finance Corporation (DHFL) was a housing finance company. It mainly gave home loans to low- and lower-middle-income families in smaller cities.[S7]
Its assets under management, the loans it ran, were about ₹1.27 lakh crore on 31 Dec 2018, ICRA reported.[S8]
From February 2019, rating agencies cut the ratings on its short-term debt, one step at a time. On 5 Jun 2019, CRISIL and ICRA cut that debt to D.[S7][S8]
This case file tells that path from the rating rationales and DHFL's own exchange filings. It then lists what the RBI, the NCLT and the Supreme Court filed next.
What was being rated?
The ratings in this case were on commercial paper. That is short-term borrowing: a company sells IOUs to investors and repays them within a year.
DHFL's rated paper ran for 7 to 365 days.[S7] Its other borrowing included non-convertible debentures (NCDs): bonds that cannot be turned into shares.[S11]
Short-term debt has its own scale. SEBI's standard scale runs from A1 at the top down to A4, plus D.[S20]
D means the debt is in default, or expected to be in default on maturity.[S20] A rating "watch" flags a possible change in the short term. "Negative implications" means the change may be downwards.[S20]
How did the ratings move, step by step?
Each step below links to the agency's rationale or DHFL's filing. The rationales quote the agency's own reasons.
CRISIL puts DHFL's short-term rating on watch with negative implications[S1]
The rating stayed at CRISIL A1+. CRISIL cited "prolonged challenges faced by DHFL in raising funds". DHFL lent ₹510 crore in Oct–Dec 2018, against ₹13,870 crore in Jul–Sep 2018.
CRISIL cuts the rating to A1, still on watch[S2]
CRISIL pointed to "limited progress in the last one month in raising funds". It put DHFL's liquidity, its cash and near-cash, at about ₹4,800 crore.
CRISIL cuts the rating to A2+[S3]
CRISIL cited a "significantly slower build-up of liquidity" than it had expected. It noted that some NCDs let investors seek early repayment if long-term ratings were cut.
CRISIL cuts the rating to A3+[S4]
CRISIL cited "continued low visibility in raising funds". Liquidity was about ₹4,000 crore in the second week of April. Scheduled outflows till June 2019 were estimated at ₹9,900 crore.
CRISIL cuts the rating to A4+[S5]
CRISIL cited a "more-than-expected reduction in the company's liquidity". Liquidity was ₹2,775 crore on 30 Apr 2019, against estimated outflows of ₹8,400 crore till July 2019.
ICRA cuts its rating from A3+ to A4, still on watch[S6]
ICRA said DHFL's liquidity buffer fell from ₹3,982 crore on 11 Apr 2019 to ₹2,775 crore on 30 Apr 2019. It cited delays in selling project loans and raising capital.
Interest on public-issue NCDs falls due and is not paid in full[S11]
Interest of ₹961.95 crore was due that day on NCDs sold to the public. The trust deed, the contract with debenture holders, allowed seven working days before non-payment became an event of default. DHFL said dues on its privately placed NCDs that day were paid.
CRISIL and ICRA cut the commercial paper to D[S7][S8]
Both agencies cut their ratings on ₹850 crore of commercial paper to D and took them off watch. Their reasons are quoted in the next section.
DHFL files the rating changes with BSE and NSE[S9][S10]
The filing listed each agency's new rating, old rating and reason. It also showed CARE Ratings and Brickwork Ratings at D on DHFL's other debt, including NCDs and fixed deposits.
DHFL files a disclosure on the unpaid interest[S11]
DHFL said it had paid ₹59.74 crore to 35,595 retail investors. It said the rest would be paid within the cure period. The public NCDs had about 36,700 investors.
DHFL reports full payment of the interest within the cure period[S12]
A certificate under Regulation 57(1) of SEBI's listing rules listed each NCD series and its payment date of 11 Jun 2019.
What reasons did the agencies give for the D grade?
The D grade came before any of the rated commercial paper fell due. CRISIL said ₹750 crore of the ₹850 crore was due in June 2019, the first on 7 Jun.[S7]
CRISIL linked the cut to the delayed NCD payments, which it did not rate. It said it "expects the CP to be in default on maturity".[S7]
ICRA cited the same delay of 4 Jun 2019. It said the company "is unlikely to be able to service its debt obligation" on its commercial paper on time.[S8]
DHFL disagreed in a statement filed with the exchanges the same day. It called the action "extremely surprising" and said it was seeking clarification on the rationale.[S10]
What was filed after the default grade?
The next filings came from the regulator and the courts. The NCLT (National Company Law Tribunal) is the court that runs insolvency cases.
RBI supersedes DHFL's board and appoints an Administrator[S13]
The RBI acted under Section 45-IE of the RBI Act. It cited "governance concerns and defaults by DHFL in meeting various payment obligations".
RBI applies to the NCLT under the Insolvency and Bankruptcy Code[S14]
The RBI used the code's rules for financial service providers. Under them, an interim moratorium, a pause on lawsuits and recovery actions against the company, began on filing.
NCLT admits the application[S15]
This began the corporate insolvency resolution process. The RBI's release of 4 Dec 2019 records the date of the order.
Resolution plan filed with the NCLT[S16]
The Committee of Creditors, the lenders who vote on a plan, had approved Piramal Capital & Housing Finance's plan. After a no-objection from the RBI, the Administrator filed it for approval.
NCLT approves the resolution plan[S17][S18]
DHFL told the exchanges the approval came "with certain conditions". It also said that, on the liquidation value estimated by registered valuers, no value was attributable to its equity shares. It said the plan proposed to cancel them without payment and delist them.
Supreme Court upholds the NCLT's approval[S19]
On 27 Jan 2022, the appeals tribunal (NCLAT) had modified one term of the plan. The Supreme Court set that order aside and upheld the NCLT's approval of 7 Jun 2021.
Where do these kinds of filings appear?
- The company's rating filing. DHFL filed its rating changes under SEBI's listing rules. Its filing of 5 Jun 2019 put every agency's action and reason in one table.[S9] The guide to credit rating upgrades and downgrades explains what must be disclosed.
- The agency's rationale. Each rationale ends with a rating history table. CRISIL's of 5 Jun 2019 lists all five dates in 2019 before the D grade.[S7] The guide to reading a credit rating report walks through each section of one.
- The liquidity paragraph. CRISIL's rationales from February to May 2019 each gave a liquidity figure. CRISIL put it at around ₹6,500 crore on 31 Jan 2019 and ₹2,775 crore on 30 Apr 2019.[S1][S5]
- The debt payment disclosure. DHFL's 7 Jun 2019 filing on the unpaid interest named a SEBI circular of 4 Aug 2017 and Regulation 57(1).[S11] Its 11 Jun certificate confirmed the payment.[S12]
What the letters A1+ to D mean is in what is a credit rating?. Where to find any of these filings is in the guide to stock exchange announcements.
What does this case file not cover?
It records what was filed and when. It does not judge the agencies, the company or its management, and it does not cover the share price.
The Supreme Court's judgment of 1 Apr 2025 directed the NCLT to decide separate applications on certain past transactions.[S19] Those proceedings are not part of this timeline.