India Company Ltd (IIFCL) has sought clearance from the banking sector regulator to lend to infrastructure investment trusts, or InvITs, as they are performing well.
“We have planned to lend around Rs 4,000 crore in this financial year, subject to approval from the Reserve Bank,” said IIFCL managing director PR Jaishankar.
“This will lead to improvement of IIFCL’s own asset quality because we will be investing in brownfield, completed projects sans construction risk,” he added.
On Tuesday, the infrastructure financing firm reported a net profit of ?325 crore for the year ended March 2021, more than a three-fold jump, as compared to Rs 94 crore in the previous fiscal.
The management attributed this performance to its strategic plan, aided by recovery and reduction of bad loans. The standalone profit of the company increased five times to Rs 286 crore as compared to Rs 51 crore in 2019-20.
The infrastructure financing firm has also developed an online project monitoring system for remote monitoring of its infrastructure projects. “This will help in digitalisation of monitoring of projects for ensuring progress-linked disbursements in projects,” said Jaishankar. IIFCL will also establish an inhouse research and advisory wing.
“IIFCL is now in the process of bringing in a market-oriented dynamism in all its activities, with an improved credit policy, segmented risk-based pricing, enhanced efforts for recovery,” said Jaishankar, adding that they continue to focus on active treasury management.
IIFCL has achieved the highest-ever sanctions and disbursements at Rs 20,892 crore and Rs 9,460 crore, respectively, on a standalone basis. Its net non-performing assets (NPAs) also came down to 5.39% in March 2021 from 9.75% last year and cash recovery in NPAs increased to over Rs 625 crore in FY 2021, which is 92% higher than last year. The provision coverage ratio increased from 50.51% in 2019-20 to 61.24% at the end of March 2021.
“We will try and bring down the net NPA to 4% by the end of the current fiscal,” said Jaishankar, adding that they have plans to raise Rs 15,000 crore from bond markets.
Asked about a merger with the proposed Development Finance called National Bank for Financing Infrastructure and Development (NaBFID), he said, there are no such plans, rather the company has its own growth agenda.