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Vol. 3 No. 1 (2025)
Articles

Corporate Financial Distress and Debt Restructuring: A Systematic Literature Review on PKPU Mechanisms in Indonesia’s Textile Industry

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  • GP Aji Wijaya,
  • Raden Aswin Rahadi
GP Aji Wijaya
School of Business Management, Institut Teknologi Bandung
Raden Aswin Rahadi
School of Business and Management, Institut Teknologi Bandung
DOI: https://doi.org/10.58229/jims.v3i1.327

Published 2025-05-15

Keywords

  • Financial distress,
  • debt restructuring,
  • PKPU,
  • insolvency mechanisms,
  • textile industry,
  • systematic literature review
    • ...More
    Less

How to Cite

Wijaya, G. A., & Rahadi, R. A. (2025). Corporate Financial Distress and Debt Restructuring: A Systematic Literature Review on PKPU Mechanisms in Indonesia’s Textile Industry. Journal Integration of Management Studies, 3(1), 124–136. https://doi.org/10.58229/jims.v3i1.327

Abstract

Corporate financial distress is a recurring challenge, particularly during economic downturns and sector-specific crises. In Indonesia, the Penundaan Kewajiban Pembayaran Utang (PKPU) framework offers a legal mechanism to facilitate debt restructuring. This study applies a systematic literature review (SLR) combined with a case study of PT Rejekitex to examine how PKPU mechanisms function within the textile industry. It explores the theoretical foundations of financial distress—including Trade-Off, Agency, and Pecking Order theories—compares PKPU with international frameworks such as U.S. Chapter 11, and identifies key research gaps concerning the long-term effectiveness of PKPU, conflicts among creditors, and recovery strategies adopted by firms. The findings indicate that the success of PKPU-driven restructuring depends on factors such as creditor alignment, industry stability, and firm-specific strategies. The study contributes a conceptual framework that maps the causes, mechanisms, and outcomes of court-supervised restructuring processes under PKPU. While the analysis centres on Indonesia’s textile sector, the proposed framework holds broader relevance for other debt-intensive industries in emerging markets.

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