An Asset Reconstruction Company is a company which is registered under Section 3 of the Secularization and Reconstruction of Financial assets and Enforcement of Security Interest Act, 2002. These companies come under the jurisdiction of the Reserve Bank Of India as a Non-Banking Financial Company.
Most of the businesses in India are unsuccessful and close down due to the inability of the owners to deal with the financial pressures of the business. In these unsuccessful businesses, there is generally poor management or even sometimes mismanagement of the capital. Some of the other causes include pressure from banks, legal action and penalties. It is at this point that these businesses should take the help of asset reconstruction companies. One such prominent and highly skilled company is that of JM Financial. They offer their services in asset management and in alternative asset management. They help in the generation and development of both the existing assets and also further assets and convert them into profits for the company.
These asset management companies in India lik JM Financial direct and oversee several forms of strategies which they device so as to enhance and develop a company’s assets and resources and to restore it to their former glory.
The main goal of the asset reconstruction company, India is to oversee, strategies, enhance and develop assets of the company or business an do make them profitable in the long run. However, one of the demerits which these asset reconstruction companies face is the loss of income as they deal mostly with companies who are themselves facing losses in the business. But if they are able to reconstruct the company and restore them to their former glory, then they get to have a part of the profits. However, in order to be successful all the details and data of the stocks, bonds, profits and losses as well as management issues and the history of the country over the years are taken into consideration too before strategies and plans are worked upon.