RIL's ₹3,567-crore IBC buy of Sintex Industries turned its yarn business around

Sintex Industries, the 1935-era yarn and fabric maker, announced its admission into insolvency in April 2021 after a financial creditor's petition. Reliance Industries and Assets Care & Reconstruction Enterprise won the resolution with a ₹3,567-crore plan, approved by the NCLT's Ahmedabad bench on 10 February 2023.

On 28 March 2023 RIL and ACRE completed the acquisition. The entire pre-existing equity was cancelled without consideration — liquidation value for shareholders was assessed at nil — and the company was delisted. RIL took 70%, ACRE 10% and the erstwhile secured financial creditors 20%, while RIL infused ₹600 crore of equity and ₹900 crore of optionally convertible debentures and gave an unconditional guarantee on Sintex's term debt.

The turnaround showed in the numbers: CRISIL reaffirmed Sintex at AA+/Stable in December 2024, noting operating income grew about 20% in fiscal 2024 on higher production, with EBITDA margin improving from 4.0% in fiscal 2023 to 5.7% in fiscal 2024 and about 6.7% in the first half of fiscal 2025, helped by RIL-group sourcing and forward integration.

RIL took 70% of Sintex, infused ₹600 crore of equity and ₹900 crore of debentures, and guaranteed its debt; FY24 revenue hit ₹3,632 crore with EBITDA margin at 5.7%.

RIL was both buyer and customer: Sintex yarn feeds RIL's fibre-to-fabric chain and Reliance Retail's apparel demand, so synergies started on day one.

The plan cleansed the balance sheet — equity cancelled and debt restructured — while RIL's capital injection and guarantee gave banks confidence to keep lending.

Focusing on capacity utilisation and cost absorption, rather than new markets, turned higher production into margin expansion within a year.

Buying a distressed spinner pays when the buyer is also the customer: RIL's fibre-to-garment chain absorbed Sintex's yarn, and a company that lost everything under IBC came back with an AA+ rating.

Sintex kept operating as a private RIL subsidiary with 6.73 lakh spindles of capacity and exports through BVM Overseas. In August 2026 the NCLAT upheld the clean-slate principle, rejecting a shareholder's ₹110-crore compensation claim and confirming that pre-resolution equity rights were extinguished for good.