Government to Inject Rs 5 Bn in IFCI to Boost Financial Health
ECONOMY & POLICY

Government to Inject Rs 5 Bn in IFCI to Boost Financial Health

The government has decided to inject Rs 5 billion into the state-owned IFCI to enhance its financial stability ahead of the company's proposed restructuring and integration into a larger group.

With this capital infusion, the government's stake in the company is expected to rise from the current 71.72 per cent as of September 2024.

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

The Supplementary Demand for Grants for 2024-25 allocated an additional Rs 4.99 billion for the 'Subscription to the Share Capital of Industrial Finance Corporation of India (IFCI)'.

The Supplementary Demand for Grants also noted that considering savings of Rs 500.07 million in the same section of the grant, the remaining Rs 4.49 billion will be met from the surrender of savings in the capital section of Demand No.30-DEA, and this would not result in any additional cash outflow.

Earlier in the year, IFCI had raised Rs 5 billion by issuing equity shares to the government.

The Industrial Finance Corporation of India was established by the government on July 1, 1948, as the first Development Financial Institution in India.

For the second quarter ending in September 2024, IFCI reported a loss of Rs 220 million, and for the first half of FY24, the company recorded a loss of Rs 1.70 billion.

As part of its revival and restructuring, the Department of Financial Services (DFS), Ministry of Finance, approved in principle last month the 'Consolidation of IFCI Group,' which involves the merger or amalgamation of IFCI with StockHolding Corporation of India and other group companies.

The proposed plan includes merging StockHolding Corporation of India, IFCI Factors, IFCI Infrastructure Development, and IIDL Realtors with IFCI. Additionally, StockHolding Services, IFCI Financial Services, IFIN Commodities, and IFIN Credit will be consolidated into a single entity, which will become a direct subsidiary of the newly formed consolidated listed entity.

The government has decided to inject Rs 5 billion into the state-owned IFCI to enhance its financial stability ahead of the company's proposed restructuring and integration into a larger group. With this capital infusion, the government's stake in the company is expected to rise from the current 71.72 per cent as of September 2024. This capital infusion was approved through the passage of the first Supplementary Demand for Grants for 2024-25 in the Lok Sabha last week. The Supplementary Demand for Grants for 2024-25 allocated an additional Rs 4.99 billion for the 'Subscription to the Share Capital of Industrial Finance Corporation of India (IFCI)'. The Supplementary Demand for Grants also noted that considering savings of Rs 500.07 million in the same section of the grant, the remaining Rs 4.49 billion will be met from the surrender of savings in the capital section of Demand No.30-DEA, and this would not result in any additional cash outflow. Earlier in the year, IFCI had raised Rs 5 billion by issuing equity shares to the government. The Industrial Finance Corporation of India was established by the government on July 1, 1948, as the first Development Financial Institution in India. For the second quarter ending in September 2024, IFCI reported a loss of Rs 220 million, and for the first half of FY24, the company recorded a loss of Rs 1.70 billion. As part of its revival and restructuring, the Department of Financial Services (DFS), Ministry of Finance, approved in principle last month the 'Consolidation of IFCI Group,' which involves the merger or amalgamation of IFCI with StockHolding Corporation of India and other group companies. The proposed plan includes merging StockHolding Corporation of India, IFCI Factors, IFCI Infrastructure Development, and IIDL Realtors with IFCI. Additionally, StockHolding Services, IFCI Financial Services, IFIN Commodities, and IFIN Credit will be consolidated into a single entity, which will become a direct subsidiary of the newly formed consolidated listed entity.

Next Story
Infrastructure Transport

Gurugram’s Key Corridor Set for Expansion

The National Highways Authority of India (NHAI) is set to develop a six-lane surface road and a flyover along the high-traffic stretch between Hero Honda Chowk and Umang Bhardwaj Chowk in Gurugram. The project, estimated at Rs 2.1 billion, aims to decongest one of the city's busiest corridors. The Gurugram Metropolitan Development Authority (GMDA), overseeing the project, has already funded utility relocations. Authorities are now finalizing cost estimates for shifting electricity, water, and sewage lines, with relocation work expected to take six months. Initially planned in 2021, the 3.2-k..

Next Story
Infrastructure Transport

Mumbai-Ahmedabad Bullet Train: Major Progress in Maharashtra

The Mumbai-Ahmedabad Bullet Train corridor is witnessing rapid infrastructure development in Maharashtra, with significant progress reported on the 135.45 km elevated section from Shilphata to Zaroli. Key Infrastructure Highlights This segment, the second-largest in the project after the 237 km stretch in Gujarat, includes: Viaducts & Bridges: 124 km of elevated structures Stations: Thane, Virar, Boisar Tunnels: 7 mountain tunnels Major River Bridges: Ulhas, Vaitarna, Jagani Steel Bridges & Crossings: 36 structures, including 12 steel bridges Construction Updates Station Work: Foundat..

Next Story
Real Estate

Omaxe Group Unveils BeTogether to Drive Urban Development

Omaxe Group has launched BeTogether, a new real estate brand focused on transforming urban infrastructure through joint ventures and public-private partnerships (PPP). The initiative aims to address infrastructure gaps, drive socio-economic growth, and create vibrant urban centers across India. The brand’s current projects involve an investment exceeding Rs 28 billion, with an estimated revenue potential of over Rs 50 billion in the next three to five years. Led by Rohtas Goel, non-executive chairman, along with Mohit Goel, MD and founder of BeTogether, and Jatin Goel, ED of Omaxe Group and..

Hi There!

"Now get regular updates from CW Magazine on WhatsApp!

Join the CW WhatsApp channel for the latest news, industry events, expert insights, and project updates from the construction and infrastructure industry.

Click the link below to join"

+91 81086 03000