Value Preservation Remains a Challenge
While India’s financial services sector shows strength with gross non-performing assets (NPAs) falling to 2.15% by September 2025 and the Nifty Financial Services Index gaining 15.5% in the first half of 2025, the Insolvency and Bankruptcy Code (IBC) continues to struggle with preserving company value. The IBC often favors debt recovery over helping businesses truly revive, especially those with few physical assets. Despite the sector’s overall recovery, creditors still face substantial losses, with average haircuts around 68% on admitted claims, showing that value is often lost during the resolution process.
Asset-Light Firms Face Bigger Hurdles
The IBC works better for businesses with clear…