Author: Neel Achary

Rise of PIK Structures Masks Borrower Stress and Challenges Private Credit System, New Study Shows

July 21: A substantial liquidity shift is underway in the global private markets as private equity fund managers are increasingly turning to PIK (payment-in-kind) structures to manage cash flows, which in turn is raising challenging questions around transparency and risk management, according to new research* from Ocorian, a leading U.S. and global asset services provider.

The study of private equity fund managers in in the U.S. and across Europe, managing $3.511 trillion, found that almost nine out of 10 (86%) expect PIK prevalence within their private credit exposure to grow over the next two years. Of these, 4% say their use will increase dramatically, and 82% say it will increase slightly. The remaining 14% believe PIK prevalence will remain unchanged.

Search for flexibility in a challenging market

PIK structures allow borrowers to issue additional debt or equity to lenders rather than servicing interest obligations with immediate cash payments. While this provides breathing room for portfolio companies, it simultaneously signals underlying vulnerabilities in corporate balance sheets.

Worryingly, nine in 10 (90%) of those surveyed agree that there is a growing risk of PIK usage masking true borrower distress, with 16% of these strongly agreeing that deferring hard cash obligations makes it difficult to distinguish between proactive capital management and severe liquidity struggles.

Anatoly Sorin, UK Head of Loan Agency and Bond Trustee Services at Ocorian, said: “Our research reveals an overwhelming consensus that PIK structures are on the rise, and private equity fund managers are doing everything they can to support portfolio companies through a prolonged period of higher financing costs. However, this flexibility does come with a warning label.”

As PIK adoption grows, capability gaps emerge 

In addition to this challenge, Ocorian’s study also exposes operational and technological vulnerabilities connected to the growing adoption of PIK structures. As PIK interest compounds, it directly alters preferred return hurdles, the distribution waterfall, and the complex calculation of realised versus unrealised gains – the metric that ultimately dictates performance fees, or ‘carried interest’.

Only 17% of firms surveyed report having robust, automated systems capable of fully accounting for PIK compounding within the waterfall modelling. Just under a third (32%) admit they rely entirely on external providers, such as fund administrators, to handle the structural complexity. Just over a third (39%) acknowledge they can model PIK but require significant manual adjustment, while 10% say this remains a gap in their current capabilities. A further 2% state that PIK is not yet material enough in their current portfolio to warrant a dedicated system.

Anatoly Sorin, UK Head of Loan Agency and Bond Trustee Services at Ocorian, added: “With PIK structures becoming more prevalent, firms’ operational and technological capabilities must keep pace, either in-house or by outsourcing to expert third-party fund administrators with the skills and experience required to ensure that waterfall and carry calculations remain accurate, consistent and transparent.”

Abi Reilly, Partner, Regulatory & Compliance at Ocorian said: “As firms navigate the operational demands of PIK structures, governance and oversight need to remain front of mind. It is important that firms are able to evidence how these structures are monitored, modelled and reported on, particularly where complexity increases and third-party support is involved.”

Government Plans Simplified Export Rules to Support Small Businesses and Boost Trade

New Delhi, July 21: The government is considering easing export-related regulations to support small exporters and help them expand their presence in global markets.

The proposed changes aim to simplify compliance procedures, reduce operational challenges, and make it easier for small businesses to participate in international trade. The move is expected to benefit exporters who often face difficulties navigating complex processes and documentation requirements.

Small and medium-sized exporters play an important role in India’s economy by creating employment opportunities and contributing to the country’s export growth. The proposed reforms are aimed at providing them with a more business-friendly environment and improving their competitiveness.

Officials said the government is focusing on reducing procedural hurdles while ensuring that export systems remain transparent and efficient. Easier rules could encourage more small businesses to explore overseas markets and strengthen India’s position in global trade.

Industry representatives have welcomed steps aimed at improving ease of doing business, saying simplified processes can help smaller exporters save time, reduce costs, and focus on expanding their operations.

The proposed measures are part of the government’s broader efforts to promote exports, support entrepreneurship, and create more opportunities for businesses across sectors.

The final framework is expected to be shaped after consultations with stakeholders and relevant authorities.

Explore Finland: The Best Day Trips from Helsinki

July 21: Helsinki is more than Finland’s vibrant capital, it’s the ideal gateway to experiencing the country’s diverse landscapes, heritage and culture. For Indian travellers flying directly to Helsinki with Finnair, Finland’s efficient rail and public transport network provides seamless access to destinations beyond the capital, from medieval towns and pristine national parks to emerging cultural hubs, all within a few hours. These easy day trips offer an opportunity to experience a different side of Finland while making the most of a Helsinki itinerary. 

Porvoo: Finland’s Most Charming Medieval Town

[Credit: Finnair]

 Located just over an hour from Helsinki, Porvoo is one of Finland’s oldest towns and among its best-preserved medieval destinations. The picturesque Old Porvoo is characterised by cobbled streets, colourful wooden houses and the iconic red riverside warehouses that have become symbols of the city. Highlights include the historic Porvoo Cathedral, independent boutiques, art galleries and local cafés, where visitors can sample the traditional Runeberg Torte, one of Finland’s most celebrated pastries.

Nuuksio National Park: Escape into Finnish Nature

[Credit: Visit Finland]

 Less than 90 minutes from Helsinki, Nuuksio National Park offers visitors an introduction to Finland’s celebrated natural landscapes. Home to peaceful lakes, dense forests and well-marked hiking trails, the park provides opportunities to experience the country’s rich biodiversity and outdoor lifestyle. The Finnish Nature Centre Haltia further enriches the visit with interactive exhibitions, guided experiences and a restaurant showcasing locally inspired cuisine.

Lahti: Finland’s Emerging Cultural Hub

 [Credit: Finnair]

 Just over an hour by train from Helsinki, Lahti has established itself as one of Finland’s leading cultural destinations. The city is home to Malva – Museum of Visual Arts, housed within the historic Malski brewery complex, alongside the architecturally acclaimed Sibelius Hall, which overlooks the shores of Lake Vesijärvi. During summer, Lahti Harbour becomes a lively waterfront destination, with cafés, restaurants and outdoor terraces creating a vibrant atmosphere that reflects the city’s contemporary character.

 Discover More with Finnair

 From the medieval charm of Porvoo and the pristine landscapes of Nuuksio National Park to Lahti’s thriving cultural scene, these destinations showcase the diversity of experiences available just beyond Helsinki. With Finnair’s direct flights from Delhi to Helsinki and seamless onward rail and public transport connections, travellers can easily extend their journey and discover more of Finland beyond the capital.

Turmeric Prices Climb in Erode as Supply Concerns Push Rates Higher

July 21: Turmeric prices have witnessed a significant increase in Erode, Tamil Nadu, with rates approaching ₹20,000 per quintal as concerns over drought conditions and limited supply continue to impact the market.

Traders and farmers said reduced availability of turmeric stocks, along with uncertainty over future production, has contributed to the recent rise in prices. The supply pressure has strengthened demand for available stocks, leading to higher market rates.

Erode, one of India’s major turmeric trading centres, has been experiencing increased activity as buyers look to secure supplies amid concerns over crop availability. The price movement has drawn attention from farmers and traders across the region.

Farmers are hopeful that the rise in prices will help improve their earnings after facing challenges related to weather conditions and cultivation costs. However, market participants are closely watching the upcoming crop outlook and weather patterns to assess future price trends.

Traders said that while higher prices may benefit growers, sustained increases could also affect buyers and industries that depend on turmeric as a key raw material.

The turmeric market is expected to remain closely linked to supply conditions, rainfall patterns, and demand trends in the coming weeks as stakeholders monitor developments.

Siddha Sky Begins Possession Handover for Three Sixty Homebuyers at Wadala

Mumbai, 21 July: Siddha Group & Sejal Group have received the Occupation Certificate (OC) for Phase 1 of Siddha Sky, their flagship residential project in Wadala, Mumbai, and will begin handing over homes to customers. This project is being developed in partnership with StarOm Group.

The first phase comprises Tower 1A – named Capella, part of a larger development of five 39-storey towers. A total of 360 apartments are being handed over to homeowners following the receipt of the Occupation Certificate.

The apartments include 1, 2 and 3 BHK configurations, with a majority of buyers in this phase being end-users, reflecting steady demand from homebuyers in Central Mumbai. Wadala is emerging as a growing residential market, supported by infrastructure upgrades such as metro connectivity and improved road access, including the Eastern Freeway, and is in proximity to key business districts.

Launched in November 2021, Siddha Sky is a lifestyle-focused development with many innovative and first time in Mumbai features, like the Rooftop Skywalk connecting all five towers, Drone Delivery services, a first-of-its-kind offering in Mumbai, designed to provide residents with elevated recreational and community spaces.

“For homebuyers, possession is the real milestone. This handover marks the culmination of a long journey shaped by countless hours and hands with dedicated effort. It’s a transition from construction to community living. More than just homes, these spaces open doors to infinite possibilities.

And as residents move in, it marks the beginning of a new chapter together. This development has been envisioned to offer more than just housing, as it brings together design, connectivity and lifestyle in a rapidly evolving micro-market like Wadala. The introduction of features such as the Rooftop Skywalk, a first in Mumbai, is part of our effort to reimagine how residents engage with shared spaces in high-rise living”, said Mr Samyak Jain, Director, Siddha Group.

Siddha Sky is designed as a lifestyle-led residential development where residents will have access to a curated suite of amenities including a 22,000 sq ft residents’ club, home in the forest, sanctuary pavilion, celestial lobby, etc., along with retail conveniences within the development.

The handover of Phase 1 reflects continued momentum in project execution, with the remaining phases expected to be delivered in line with construction progress.