India faces a yin and yang situation with regard to its stressed assets problem. With bad loans in the ballpark of $200 billion, the situation appears grim. But the worst may be over, with the ratio of non-performing assets (NPA) declining at the fag end of 2018 and projected to shrink further this year.
Three years after the Insolvency and Bankruptcy Code -- the country’s bankruptcy law -- came into effect, more than 2,000 cases have been admitted into the corporate insolvency and resolution process. More than half of these cases remain unresolved. The vast majority have ended up in liquidation, with resolutions achieved only in around 5% of cases.
Participants in the ecosystem acknowledge that a beginning has been made, but feel that some fine-tuning is required to generate better outcomes. Nevertheless, stressed assets continues to be a lucrative segment -- not just for strategic buyers looking at attractive assets that have been shrouded under the cloud of debt, but also for financial investors.
To assess the progress of the bankruptcy law, structures and strategies being adopted by buyers as well as emerging challenges, Mosaic Digital, the corporate banner behind VCCircle, is organising the third edition of its Stressed Assets Investment Summit on August 8, 2019 at Taj Lands End Hotel in Mumbai.