Bad loans: Are we celebrating the outliers?

If we extrapolate the successes of a few trophy assets in steel, we will miss the fact that there are three possible outcomes of the IBC, of which the first and third are outliers

To the loud, self-congratulatory tweets of policymakers and politicians, supported by the media (which is quick to declare a few data points as a major trend), India’s bankruptcy law has been hailed as a runaway success. The first data point is Tata Steel’s successful takeover of Bhushan Steel. Tata Steel paid Rs 364 billion, out of over Rs 560 billion that Bhushan owed, benefiting some near-bankrupt public sector banks (State Bank of India being the biggest lender) and attracting epithets like “historic breakthrough” and so on.

The next big data point will be the resolution of another large steel asset, which