Search for an answer or browse help topics to create a ticket


Show moreless
View all categories

What does IRP (Insolvency Resolution Process) mean?

As per Zerodha's policy, fresh buying is blocked in stocks under IRP stage 1 and above (DOC).

IRP, or Corporate Insolvency Resolution Process, is a procedure established under the Insolvency and Bankruptcy Code, 2016 (WEB). The IBC serves as the bankruptcy legislation in India.

If a corporate debtor defaults in repayment of the creditors' dues, the financial creditor/s has the power to start the insolvency resolution process. In order to initiate the resolution process, an application has to be made to the National Company Law Tribunal (NCLT). The claims of the creditors (i.e., company assets) shall be frozen for a period of six months upon admission of application by NCLT. During this time, the NCLT shall listen to the options to revive and decide the future course of action, either debt resolution, corporate restructuring or liquidation. This process happens in stages.

Holdings of IRP stage 1 and above stocks can only be sold on the 1st trading day of the week, i.e., Monday (Tuesday, if Monday is a trading holiday). These stocks are visible in Kite holdings only on the 1st trading day of the week. However, they will be visible on Console on all trading days.

Additional surveillance mechanism (WEB) by the exchanges will be applicable on such stocks. See the list of stocks under Insolvency Resolution Process (DOC). Intraday trading and BTST will not be allowed, and 100% margins will be applicable.