The transformation in the Indian distressed companies landscape has been a pivotal factor in building a strong foundation for envisaged New India. Distressed assets represent the opportunity to purchase operational and good underlying assets, with a potential to turnaround, at attractive valuations. It enables strategic investors to expand capacity in a cost-effective manner.

The game changer has been the Insolvency and Bankruptcy Code, introduced in 2016. The Code has given stressed assets resolution a legal structure, definite procedures, and provided a level playing field for domestic and foreign investors. It has established well-defined timelines for the resolution of distressed companies. It denotes a paradigm shift in which creditors take control of assets of the defaulting debtors.

Why Invest?
  • Returns:

    Given the risk involved in investing distressed companies, the IRR is high and there is a potential to earn very high returns.

  • Liquidity:

    With a better reporting of NPAs, the liquidity in the NPA market is flush.

  • Cost-Effective Expansion:

    Distressed companies allow for a strategic way for vertical or horizontal integration.

How to Invest?

Under the Insolvency and Bankruptcy Code 2016, strategic and financial investors can acquire distressed companies by the following mechanisms:

  1. Propose a Resolution Plan under IBC
  2. Participate in the Liquidation Process
Forms of Turnaround

Capital Restructuring:

Corporate optimization process of changing the debt and equity composition of the capital structure of the company by rebalancing risks. Some ways of capital restructuring are through renegotiating its delinquent debts, divesting division or businesses to improve the financial standing of the organization and refinancing existing loans thereby reducing cost of capital.

Investment Opportunities

S

Stressed Asset ID: 3093

SRI GANESH SPONGE IRON PRIVATE LIMITED

No claim amount

Sub-Sector | Metals

S

Stressed Asset ID: 3101

PSL LIMITED

No claim amount

Sub-Sector | Metals

Success Stories

Kitply
No. of Bidders : 1
Claims INR 828 Crore
Successful Bid Amount INR 175 Crore
Successful Bidder

SREI Multiple Asset Investment Trust (Vision India Fund)

ELECTROSTEEL
No. of Bidders : 4
Claims INR 13,958 Crore
Successful Bid Amount INR 5320 Crore
Successful Bidder

Vedanta Ltd.

BINANI CEMENT
No. of Bidders : 2
Claims INR 6,469 Crore
Successful Bid Amount INR 7,950 Crore
Successful Bidder

Vedanta Ltd.

MBL INFRA
No. of Bidders : 1
Claims INR 1,700 Crore
Successful Bid Amount INR 1,597 Crore
Successful Bidder

Mr. A. K. Lakhotia (promoter)

Bhushan Powe..
No. of Bidders : 1
Claims INR 828 Crore
Successful Bid Amount INR 175 Crore
Successful Bidder

SREI Multiple Asset Investment Trust (Vision India Fund)

Market Research

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