India

Tata Steel Ltd will be able to nearly double its capacity in India as a deal between its British entity and Germany's ThyssenKrupp will reduce the Indian parent's debt, the chairman of the company said on Monday. Tata Steel and ThyssenKrupp signed a deal on Saturday after months of negotiations to form Europe's second biggest steel company in which Tata and ThyssenKrupp will have a 50:50 partnership, the International New York Times reported on a Reuters story.

Hundreds of companies are headed for bankruptcy proceedings in India, and that’s a good thing. A new bankruptcy code sets a tight timetable for a defaulting company to deal with its debt: If it doesn’t come up with a solution in nine months, the company is liquidated, The Wall Street Journal reported. In May, Bhushan Steel Ltd. became the first of a group of large defaulters pushed into the bankruptcy court by the central bank to be resolved under the new rules. It was sold for $5.2 billion, and creditors recovered almost two-thirds of what they were owed.

Imagine India’s GDP growth had collapsed to 3 percent; inflation was about to hit double digits; exports were tanking; and the country’s twin deficits – in the government’s budget, and in the nation’s current account – were out of control. It’s only when the Reserve Bank of India tries to imagine such a dire scenario for March 2019 that its simulation exercise for bad loans throws up a figure of 17.3 percent of state-run banks’ total assets, a Bloomberg View reported.

Fugitive Indian businessman Vijay Mallya has sought court approvals to sell some frozen assets worth 139 billion rupees ($2 billion), making a fresh attempt to settle bank dues owed by his now-defunct Kingfisher Airlines Ltd, Bloomberg News reported. Mallya and his United Breweries Holdings Ltd. filed an application before a court in the southern Karnataka state on June 22, seeking permission to repay creditors from the proceeds of the sale, according to a statement on Tuesday.

Essar, which owes creditors $7.6 billion, is one of a dozen large debtors that were ordered into bankruptcy court after India’s central bank received additional powers to speed the process of winding down troubled companies, Bloomberg News reported. There are more than 2,500 bankruptcy cases wending their way through India’s notoriously slow legal system. Until the special courts were established by the 2016 Insolvency and Bankruptcy Code, bankruptcies could drag on for years.

South African units of Jindal Steel & Power Ltd. filed for a local form of bankruptcy protection known as business rescue this month, Bloomberg News reported. Jindal Mining SA, Jindal Africa Investments and Eastern Solid Fuels filed notice of the voluntary proceedings on June 12, according to documents posted on Jindal Africa’s website. A spokesman for the company didn’t immediately reply to an email seeking comment. Jindal Mining SA’s main business is coal production at the Kiepersol mine, according to one of the documents.

Billionaire banker Uday Kotak’s stressed asset investment unit is asking India’s bankruptcy regulator to ensure that potential buyers of insolvent companies aren’t made to provide non-refundable deposits in exchange for financial information during the sale process, Bloomberg News reported. A court-appointed insolvency professional asked bidders for Golden Jubilee Hotels Ltd., which operates a property that in November hosted Ivanka Trump, to pay an upfront deposit of 1 million rupees ($15,000) while submitting an expression of interest, according to S.

Soon after succeeding his brother at the helm of Indian construction group Lanco, L Madhusudhan Rao spotted an opportunity that looked too good to miss. India’s 2003 Electricity Act was a landmark in the liberalising reform drive that began a decade before, turbocharging the coal-fired power sector by abolishing a burdensome licensing regime, the Financial Times reported. Mr Rao’s Lanco was quick to take advantage. Over the next few years, it borrowed heavily to set up a string of power plants scattered across the nation. Lanco was far from alone.

There have been high-profile insolvencies of many real estate and housing development companies across the country, ZeeBiz reported. Scores of homebuyers, particularly in NCR, have some relief as now they will be treated as financial creditors. Homebuyers are recognised as financial creditors under the insolvency law, with the government promulgating an ordinance. President Ram Nath Kovind gave his assent to promulgate the Insolvency and Bankruptcy Code (Amendment) Ordinance, 2018 last week. What are the next steps to take? How do you protect your financial interest?

A 200 basis-point increase in interest rates could spark a sharp rise in the proportion of emerging market corporate debt issues at risk of default, with Brazilian and Indian firms most vulnerable, a report from McKinsey Global Institute showed. Following a decade of loose monetary policy and historically low interest rates aimed at boosting economic growth after the 2008-9 financial crisis, global central banks including the U.S. Federal Reserve and the European Central Bank are either raising interest rates or signalling an end to accommodative policies, Reuters reported.