India's oldest DFI is sick. A new prescription is on way

livemint.com:

₹500 crore capital into IFCI in the second half of FY25—even though the Union budget of 2024-25 has not made any allocation—to reduce its debt and strengthen its financials, thereby easing the burden on any other entity or strategic investor involved in its restructuring. IFCI shares closed 4.58% higher at ₹54.57 on the BSE on Friday. Set up in 1948 as a development financial institution, IFCI was later turned into a non-banking finance company (NBFC).

Its activities covered financing of various kinds of projects such as airports, roads, telecom, power, real estate, manufacturing, services, and other such allied industries. A combination of imprudent lending and poor management turned the institution sick in the late 1990s, and has failed to turn around despite continued government support. The company reported a loss of ₹444 crore in FY19, which shrank to ₹278 crore in FY20.

But the losses shot up to ₹1,958 crore and ₹1,991 crore in FY21 and FY22, respectively. With active capital support, IFCI again brought down losses to ₹288 crore in FY23. In the current fiscal year, it reported losses in the first and third quarters.

It clocked a profit of ₹83.77 crore in the second quarter as capital support from the government covered a large portion of its provisioning requirements. As on 31 March 2023, IFCI had six subsidiaries: IFIN, IFCI Venture Capital Funds Ltd, IFCI Infrastructure Development Ltd, IFCI Factors Ltd, MPCON Ltd, and SHCIL. Of these, IFCI has only two material subsidiaries: IFCI Infrastructure Development Ltd, which reported a profit of ₹16.13 crore in FY23, and SHCIL that returned a profit of ₹178.11 crore in FY23.