Does anybody know if this falls under the “Uber Cannibals” framework?

So, just coming basic point, the company has defaulted and not able to honour its obligation. In more than 95% of the cases, Financial creditors/opertional creditors need to take waiver on their claims. In simple finance, when lenders take waiver (which mean cashflow value/assets value of company is not able to meet debt obligation), equity value is nil. In that scenario, why would rationale investor offer equity value in such IBC cases to equity holders?

In my understanding, only two reasons can justify equity value.

1. Accumulated losses can be utilised as tax shield in future by profit making new investor in case they merged IBC referrred company
2. In case of listed company, acquisition of IBC give indirect listing route to new investor (after merger of existing business, something similar to Orchid Pharma and Bhushan steel post Tata group acquisition).

In these situation, 99% of resolution plan have following clauses:

1. Full writedown of equity owned by previous promoter group
2. 90-99% equity value wirte-down by previous non-promoter group shareholding
3. Some stake being given to financial creditor for waiver of claim

Subsequently, equtiy share face value would be consolidated to previous value. So a minority shareholder holding 100 shares of Rs 10 face value each (Total face value Rs 1000), would end up on 90% write down 100 share of Re 1 each (Total Face value 100). Subsequently, share capital would have consolidated face value of Rs 10 each resulting in 10 shares of Rs 10 each (Total face value of Rs 100).

Now when the scheme is implemented, very few shareholder would have shares which are available in their demat account. Someone holding 1,000+ share only would be 10 shares now. Furtther, the new listing approval and allotment also take some time. During that period, we she major volatility in such shares. I would strongly advise investors to understand whole events timeline and cautiously look at investing during these volatile period.

Enclosing certain example of volatility during that period.
Orchid pharma: 24 July 2019 price Rs 5.45, delisted, and post corporate restucturing (IBC approval resolution plan) reslited on 6 Nov 2020 Rs 20.75. Price went up from Rs 2527 per share on 1 April 2021, almost 100x during 5 months with very limited volume of 1,000-4,000 shares traded per day. By March 2022, share price declined to Rs 282, almost 89% decline.

Same pattern can be observe from Ruchi Soya (Now Patanjali) and Alok textile.

The biggest risk while investing in these company at very low price, the reoslution plan may provide for delisting with complete write down of old equity capital. In such situation, one has write off investment one hold in such companies. Probability of such incidence would be in very high (say more than 50-60% cases). Given such outcome, I would sugest every one to careful and not carried away by just price increases. It would be very difficult even during upswing to exit from such stock in my limited undestanding.