Govt to infuse Rs 500 cr capital in IFCI to improve financial health

The government has decided to infuse Rs 500 crore capital in state-owned IFCI to improve its financial health 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 existing 71.72 per cent as on September 2024.

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

The Supplementary Demand for Grants for 2024-25 made an allocation for an additional amount of Rs 499.99 crore for 'Subscription to the Share Capital of Industrial Finance Corporation of India (IFCI).

Earlier this year, IFCI had raised Rs 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 Rs 22 crore and in the first half of FY24, a loss to the tune of Rs 170 crore.