The fall of Evergrande, China’s second-largest real estate developer, has sent shockwaves throughout the globe. CEO of Kotak Mahindra Bank, Uday Kotak referred to the Evergrande collapse as “China’s Lehman moment.”

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On September 15, 2008, Lehman Brothers declared bankruptcy, precipitating the US subprime mortgage crisis and sending shockwaves around the world.

According to Kotak, the threat posed by China’s second-largest real estate developer reminded him of Infrastructure Leasing & Financial Services (IL&FS).

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When the infra leasing and financial services business ran out of money in September of last year, it couldn’t pay its debts. There was a liquidity crisis as a result of the shaking in the financial services industry.

In October, the government stepped in to replace the board and hand-picked its replacements. It had agreed to prolong Kotak’s term as the debt-ridden company’s non-executive chairman for another year.

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Uday Kotak praised the government’s quick decision-making and claimed Indian authorities had calmed financial markets. For IL&FS, the government-appointed board predicts a 61% recovery rate while China’s Evergrande bond trades for about $0.25 to a dollar.

Anand Mahindra Chairman of  Mahindra Group quoted the tweet and lauded Kotak and Vineet Nayyar for keeping the IL&FS boat afloat and stable in rough seas. In October of last year, Nayyar resigned as Executive Vice-Chairman of the IL&FS Group, citing health concerns.

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RPG Enterprises Chairman Harsh Goenka took to Twitter to give his thoughts on Evergrande’s fall. He stated that China’s real estate behemoth borrowed $305 billion from 128 banks and 121 non-banking financial institutions.

With a business plan based on massive debts, it ended up purchasing a soccer franchise, Guangzhou Football Club, and constructing a $1.7 billion soccer stadium. Evergrande also made investments in the bottled mineral water sector and the electric car industry.

Goenka asked his followers on Twitter  “Who could be India’s Evergrande?”

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Edelweiss Mutual Funds’ MD and CEO, Radhika Gupta, released a statement and disclaimer on recent market activity in the Chinese markets, urging investors to remain calm.

Gupta mentioned current short-term worries in China in her statement. The statement advised long-term investors to remain patient and not panic as a result of the volatility and in fact, investors with extra funds should invest more and expand their portfolio in the fund.