Lenders can realise Rs 55,000-60,000 crore from IBC cases in FY22

Large housing finance company resolution seen as key drive; second wave could cause delays and increase haircuts

Financial creditors could realise Rs 55,000-60,000 crore in FY22 from cases in the bankruptcy court, largely driven by the likely resolution of a large housing finance company. However, the second Covid-19 wave could again delay resolutions and increase haircuts, according to Icra.

The realisation for financial creditors from the resolutions under the Insolvency and Bankruptcy Code (IBC) 2016 declined significantly in FY21 with a total resolution amount of about Rs 260 billion, almost a quarter of the realisations in FY2020.

Abhishek Dafria, Vice President and Group Head–Structured Finance, Icra, said besides the fate of the HFC case, realisation by financial creditors would