Arun Jagatramka: Fall of a ‘rock star’


It is not often that a firm’s promoter resorts to advertorials in business papers to air his views. But Arun Kumar Jagatramka is in dire straits and he has few options. His company – Gujarat NRE Coke – is facing liquidation after a failure in implementing a resolution plan under the National Company Law Tribunal (NCLT). The company, which was referred to the NCLT in April last year, owes Rs 4,600 crore to lenders.

“Liquidation as a resolution to NPA crisis would be disastrous for the economy, society and the banking system,” says Jagatramka in the advertorial that appeared in a business daily on Tuesday. And then the 56-year-old puts the blame squarely on banks: “There is a need to make bankers accountable for their actions… if any company is forced into liquidation due to indecisiveness of bankers or due to their wrong decisions…then they should be held accountable.”


(Arun Kumar Jagatramka

But not everyone who has followed the meteoric rise of the entrepreneur from Kolkata, and his equally dramatic fall, is convinced.

The basketball loving miner

In the years following his acquisition of two mines in Australia in 2004 and 2007, Jagatramka was living a life every entrepreneur dreams of.  With prices of coke, which was used by Jagatramka’s company to make metallurgical coke, going through the roof, the mines helped him hedge against high raw material costs. Gujarat NRE Coke emerged as the country’s largest producer of metallurgical coke, which is used in steel production.

By February 2008, stocks of Gujarat NRE Coke hit a lifetime high of Rs 120 a share. Its revenues continued to gallop, reaching Rs 1,593 crore in the 2011FY, from Rs 285 crore in the 2004FY.

Publicly, Jagatramka’s profile rose. Company releases would note that he is a “Chartered Accountant with India 1st rank and Gold Medal.” He became a constant feature at Vibrant Gujarat Summits and revelled in the company of the then Chief Minister Narendra Modi. Even today, the profile photo of his Twitter handle is a selfie snap along with the present Prime Minister.

Far away in Australia’s mining city of Wollongong in New South Wales, Jagatramka had become a hero. His acquisition and subsequent investment in the local mines had saved jobs. And the businessman became a ‘rock star,’ after agreeing to put A$1 million in the local basketball team. Local media pronounced him ‘Person of the Year,’ and he was even nominated for the Australian of the Year honour in 2010.


But things soured in no time. An ambitious expansion plan, crucial to keep the local jobs, got stalled after it emerged that Jagatramka hadn’t disclosed his political donations, as was the local norm. As salary payments of mine workers got delayed, Jagatramka’s $5 million house in the city and his penchant for tailored suits and swanky Bentley got unwanted attention. Unpaid workers didn’t take lightly when their boss came in a luxury car for a meeting.

By the end of 2012, Gujarat NRE Coke’s Australia unit had nearly A$500 million in unpaid debts. Not surprisingly, within a year, Jagatramka lost control of his mining jewels to Naveen Jindal, the billionaire owner of JSPL.

Back home too, things weren’t going his way. Rising imports from China and an unfavourable pricing environment saw the local met coke industry operating at 25 per cent capacity utilisation. By 2016, Jagatramka had to sell his company’s non-core assets, including the wind mills, to say afloat. But that helped little as Gujarat NRE Coke’s debt-equity ratio went beyond 6.5. Financing taken for Rs 1,000-crore expansion in Indian facilities hurt the company.

Final nail

If Jagatramka planned to get back the control of his company after it was referred to the NCLT in 2017, the government’s ordinance banning promoters from bidding put paid to his plans. Now the businessman had to first pay off the interest dues to qualify as a bidder.

After a sole bid for Gujarat NRE Coke was rejected late last year, NCLT ordered the company to go for liquidation on January 11. A day later, Jagatramka took to Twitter to air his complaints against the banking system. In one of the eight tweets, the troubled businessman said: “Gujarat NRE has had a great past and does have a potentially greater future if only Bankers could understand…”

Not letting go, Jagatramka tweeted again two days later, this time tagging the Prime Minister’s Office, Finance Minister Arun Jaitley, the official handles of RBI and SEBI, and also a BJP spokesperson.

Even under liquidation, legal experts opine, Jagatramka may be unable to bid for his company. Interestingly, it is for the time that a company will be liquidated as a ‘going concern.’ This means, instead of selling the assets in whole or, in part, now the bidder will buy Gujarat NRE Coke as a going concern with its nearly 1,200 workers.

“The option of slump sale is a positive development. Not only does it help save the jobs of employees, it is also another attempt to save the company,” says Jyoti Singh, Insolvency and Disputes Partner at Phoenix Legal.

But where does it leave Jagatramka? Can he save his company, and his stake too? If one goes by the advertorial, or his statements on Twitter, the entrepreneur is surely putting up a fight.