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regular-article-logo Monday, 23 December 2024

Centre to infuse Rs 500 crore in state-owned IFCI ahead of proposed restructuring

With the infusion, the government of India’s holding in the company is expected to further increase from 71.72 per cent

PTI New Delhi Published 23.12.24, 10:20 AM
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The government has decided to infuse 500-crore capital in state-owned IFCI ahead of the company’s proposed restructuring and consolidation into a group.

With the infusion, the government of India’s holding in the company is expected to further increase from 71.72 per cent.

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The capital infusion plan for IFCI was approved through the passage of the first Supplementary Demand for Grants for 2024-25 in the Lok Sabha last week.

The supplementary demand made an allocation for an additional amount of 499.99 crore for ‘Subscription to the Share Capital of Industrial Finance Corporation of India (IFCI)’.

“Taking into account savings of 50.07 crore available in the same section of the grant, the remaining amount of 449.92 crore will be met from surrender of savings available in the capital section of Demand No.30-DEA and it will not entail any additional cash outgo,” the supplementary demand for grants said.

Earlier this year, IFCI had raised 500 crore capital through the issuance of equity shares to the government.

The Industrial Finance Corporation of India was set up by the government on July 1, 1948 as the first development financial institution in the country.

In the second quarter ended September 2024, IFCI had booked a loss of 22 crore and in the first half of FY24, a loss to the tune of 170 crore.

The department of financial services (DFS), ministry of finance, last month in-principle approved ‘Consolidation of IFCI Group’ which entails merger/amalgamation of IFCI Limited and StockHolding Corporation of India Limited and other group companies.

StockHolding Corporation of India Ltd, IFCI Factors Ltd, IFCI Infrastructure Development Ltd and IIDL Realtors Ltd will merge with IFCI Ltd.

Further, StockHolding Services Ltd, IFCI Financial Services Ltd, IFIN Commodities Ltd and IFIN Credit Ltd will be merged into a single entity, which will be a direct subsidiary of the consolidated listed entity.

Additionally, StockHolding Document Management Services, StockHolding Securities IFSC Ltd, IFIN Securities Finance, IFCI Venture Capital Funds and MPCON Ltd shall be direct subsidiaries of the consolidated listed entity that is IFCI.

PTI

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