First glimpse into Indian defaulters’ $25b debt pile

New Delhi: Listed Indian companies that have defaulted on some debt owe banks and financial institutions a total $25 billion (Dh91 billion), the first insight for investors into the extent of the problem after tighter rules forced the firms to come clean.

About 72 companies, from conglomerates helmed by fallen billionaires to smaller businesses, have some Rs1.8 trillion ($25 billion) in outstanding debt, exchange filings show. As of December 31, the firms had defaulted on more than Rs840 billion, or 47 per cent, of this.

While it’s unclear when the debt will come due, some firms may find it tough to repay as India’s economy slows to levels last seen during the financial crisis. The nation’s banks are already grappling with the world’s worst bad-loan ratio and shadow lenders that provide rollover financing face a funding squeeze.

The Securities and Exchange Board of India in November ordered listed companies to disclose details of their defaults within seven days from the end of each quarter.