Record 273 stressed cases resolved via IBC in 2023
stressed firms were rescued through the insolvency law in 2023 and the resolutions fetched their creditors more than three times the amount raised through 160 such debt resolutions in 2022, a senior official told ET, citing data compiled by the bankruptcy regulator.
The realisation proceeds were to the tune of ₹67,000 crore in 2023 against ₹20,860 crore in 2022, according to the Insolvency and Bankruptcy Board of India (IBBI) data yet to be made public. The jump indicates a «robust upward trajectory» in the IBC's (Insolvency and Bankruptcy Code's) effectiveness, the official said.
A Delhi-based expert involved in shaping the insolvency policy said the 2023 resolution numbers also mirror the broader economic momentum being witnessed after the pandemic blues, which has expanded the universe of bidders for stressed assets.
Also, the appointment of about three dozen members to the National Company Law Tribunal (NCLT) over a year through September 2023 expedited the resolutions process in 2023, the expert said.
Cumulatively, 887 insolvent firms saw resolution between late 2016, when the IBC was adopted, and December 2023. The total realisation for creditors stood at about ₹3.2 lakh crore, or nearly 32% of their admitted claims, the official said, citing preliminary IBBI data.
The realisation from these stressed firms was 168% of their liquidation value when they were admitted for resolution, according to the IBBI data.
The recovery improved in 2023, thanks to improved investor interest in a broad range of small and medium enterprises and above-average realisation from the assets of Srei Group.
