Insolvency
Regulation & taxA formal process for resolving a company that cannot pay its debts.
In plain terms
Equity ranks last. When lenders take haircuts, there was nothing left below them.
1492 terms
Glossary
Every term is defined twice: once the way a filing would put it, and once the way somebody would explain it to you across a table. The second one is usually the one that sticks.
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IBC
Regulation & taxAlso called: Insolvency and Bankruptcy Code
India’s Insolvency and Bankruptcy Code, governing time-bound resolution of defaults.
In plain terms
Faster and more predictable than the old regime, and promoters are generally barred from bidding for their own company.
Personal insolvency
Regulation & taxThe part of India's insolvency code dealing with individuals, brought into force at the time of writing only for a narrow class — personal guarantors to corporate debtors — and not for ordinary borrowers.
In plain terms
No modern personal-bankruptcy discharge is available to an ordinary Indian borrower. Older insolvency legislation remains unrepealed but is slow and very rarely used. A live area of policy, and one to check rather than assume.
Industry consolidation
Fundamental analysisA fall in the number of participants in an industry as capacity is retired, acquired or resolved through insolvency, leaving the survivors facing less competition.
In plain terms
The tell that it is actually working is that realisations stop falling before volumes recover — price discipline needs only a decision, demand needs a cycle.
Waterfall
Regulation & taxThe statutory order in which claims are paid in an insolvency.
In plain terms
Costs, secured creditors, workers, unsecured creditors, government, then equity. Equity usually gets nothing.