As with almost every argument in this area that depends very much on context.

A substantial rewrite might be an opportunity to use better tools and improved techniques that have been developed since the original was written. In some cases that could represent a huge improvement in things we actually care about like developer productivity and the quality and performance of the product. Importantly this doesn't imply anything was done wrong or any bad decisions were made by the developers of the original product or the people who have maintained it so far. It's just that we work in a fast-moving industry and sometimes even a few years can see some big improvements in what the available technologies can do.

A development team starting with a relatively clean slate can take into account all the knowledge and feedback received over the lifetime of the existing system. Maybe it was too expensive to make use of those insights while evolving the original system but a new version can take advantage of them. Again that can represent big gains in areas that we care about.

It's often observed that a big rewrite risks losing a lot of small improvements and fixes that have accumulated over the lifetime of the existing system and of course that's true. However it's also true that a big rewrite can avoid a lot of existing design problems or get rid of long-standing bugs that no-one was ever going to get around to fixing.

I've seen big rewrites that didn't end well. But I've also seen big rewrites that were done for sensible reasons and had very positive outcomes. And I've also seen things that should have been rewritten but weren't and instead became a drag on everything. There is no universal rule here.