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Company Information

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IFCI LTD.

27 December 2024 | 12:00

Industry >> Finance - Term Lending Institutions

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ISIN No INE039A01010 BSE Code / NSE Code 500106 / IFCI Book Value (Rs.) 17.82 Face Value 10.00
Bookclosure 26/09/2024 52Week High 91 EPS 0.40 P/E 152.68
Market Cap. 15801.77 Cr. 52Week Low 28 P/BV / Div Yield (%) 3.39 / 0.00 Market Lot 1.00
Security Type Other

NOTES TO ACCOUNTS

You can view the entire text of Notes to accounts of the company for the latest year
Year End :2024-03 

k) Provisions and contingencies related to claims, litigation, etc.

Provisions are recognised when the Company has a legal and constructive obligation as a result of a past event, for which it is probable that cash outflow will be required and a reliable estimate can be made of the amount of the obligation. Provisions are measured at the present value of management’s best estimate of the expenditure required to settle the present obligation at the end of the reporting period. The discount rate used to determine the present value is a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the liability.

l) Contingent liabilities and contingent assets

A contingent liability exists when there is a possible but not probable obligation, or a present obligation that may, but probably will not, require an outflow of resources, or a present obligation whose amount cannot be estimated reliably. Contingent liabilities do not warrant provisions, but are disclosed unless the possibility of outflow of resources is remote.

Contingent assets are disclosed in the financial statements where an inflow of economic benefits is probable.

m) Cash and cash equivalent

Cash and cash equivalents include balance with banks in current accounts and term deposits, cash & cheques in hand and money lent on collateralized lending & borrowing obligations transactions.

n) Segment reporting

Operating segments are reported in a manner consistent with the internal reporting provided to the Chief Operating Decision Maker (CODM) of the company. The CODM is responsible for allocating resources and assessing performance of the operating segments of the Company.

o) Assets held for sale

Assets are classified as held for sale if it is highly probable that they will be recovered primarily through sale rather than through continuing use. Such assets measured at the lower of their carrying amount and fair value less cost to sell with gains and losses on remeasurement recognised in profit or loss.

Once classified as held for sale, assets are no longer amortised. depreciated or impaired.

1(A). Restatement of Financial Statements due to Changes in Accounting Policy

The company has modified its accounting policy regarding the recognition of stage 3 income, effective April 1, 2021. This change alignswith the recommendations of the Comptroller and Auditor General of India (CAG), the Reserve Bank of India (RBI) and the Institute of Chartered Accountants of India (ICAI).The Management has considered that the aforesaid changes are material and as a result the financials of 31.3.2023 are to be restated. The relevant extracts of the Ind AS financial statements after the incorpoartion of the afforesaid accounting policy is as given below.

39 As on 31st March 2024, the Company has changed its accounting policy whereby interest income on stage 3 assets (except on assets which are standard under IRAC norms) shall be recognized in books of accounts with effect from 01st April 2021. Accordingly, Interest Income for FY2021-22 and FY 2022-23 has increased by ' 248.03 and ' 209.50 Crore respectively. Since, there was no expectation of recovery, the same has been written off as bad debts in both the years. Hence, there is no impact on net profit/net loss of these years respectively.

During FY 23-24, the company has recognised the Interest Income of ' 160 crore and written off ' 145 crore as bad debts, since there is no expectation of recovery for the same.The previous year financial statements have been reinstated accordingly and opening balance sheet has also been prepared to reflect the changes in application of Interest income on stage 3 assets.

40 The valuation of Investments in subsidiary companies has been considered on the basis of financial statements of the subsidiaries for the period ended 31st December 2023, instead of 31st March 2024. There is no material impact of this on the financial statements of the company.

41 In the context of reporting business/geographical segment as required by Ind AS 108 - “Operating Segments”, the Company operations comprise of only one business segment of financing . Hence, there is no reportable segment as per Ind AS 108.

42 On all the secured bonds and debentures issued by the Company and outstanding as on 31st March 2024, 100% security cover has been maintained against principal and interest, by way of floating charge on book debts/receivables of the Company .

43 These financial statements have been prepared as per Schedule III Division III of the Companies Act, 2013 which has been notified by the Ministry of Corporate Affairs and published in the official Gazette on 11th October 2018. Any application guidance/ clarifications/ directions issued by RBI or other regulators will be implemented as and when they are issued/ applicable.

43.1 IFCI is carrying the investment in subsidiary companies at cost net of impairment loss (if any) and opted for one time exemption under IndAS 101 for deemed cost being the carrying value of investment as at transition date i.e. April 1, 2017. As on March 31, 2024, the Company had investment in 27,91,54,700 no. of Equity shares in its subsidiary, IFCI Factors Ltd. (IFL) and 3,93,63,809 no. of Equity shares in its subsidiary, IFCI Financial Services Ltd. (IFIN). The company got the shares of IFL & IFIN fair valued internally, per which, the fair value of investments in shares of IFL was determined at ' 16.19 crore and the fair value of investments in shares of IFIN was determined at ' 61.29 crore, using the generally accepted valuation methodologies against breakup value, in line with Indian Accounting Standards and accordingly, the resultant impairment loss has been charged in the Profit & Loss Account.

44 Uses of Funds

No funds are borrowed from banks and financial institutions during the year.

44.1 Change due to revaluation

During the year the company has not revalued its Proeprty Plant and Equipment (PPE) and intangible assets

44.2 Other additional regulatory disclosures as required under Schedule III

a. Loans and advances

The company has not granted any loans and advances in the nature of loans to promoters, directors, Key Managerial Personnel (KMPs) and the related parties, repayable on demand and where terms or period of repayment are not defined.

b. Ageing Analysis of Capital Work in Progress

There is no Capital work in progress in the current year as well as preceeding financial year.

c. Ageing Analysis of Intangible Assets under Development

There is no Intangible Assets under Development in the current year as well as preceeding financial year.

d. Benami Property:

No proceedings have been initiated or pending against the company for holding any Benami property under the Benami Transaction (Prohibition)Act, 1988 (45 of 1988) and rules made thereunder.

e. Borrowing against security of Current Assets

The company has no borrowings from bank or financial institutions against security of current assets.

f. Wilful Defaulter:

The company has not been declared as wilful defaulter by any bank or financial institution or any other lender during the year.

g. Relationship with Struck off company:

The company has no transanction with companies struck off under section 248 of the Companies Act, 2013 or section 560 of Companies Act, 1956.

h. Registration of Charges or satisfaction with Registrar of Companies (ROC)

There is no charge or satisfaction yet to be registered with ROC beyond the Statutory period.

i. Companies with number of Layer of Companies:

Company being a NBFC, clause(87) of section 2 of the Act is not applicable.

j. Scheme of arrangement

During the year no Scheme of Arrangements has been approved by the Competent Authority in terms of sections 230 to 237 of the Companies Act, 2013.

k. Utilization of borrowed funds:

(i) The company has not advanced or loaned or invested any funds to any other person(s) or entity(ies), with the understanding that the intermediary shall directlly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the company (ultimate beneficiaries) or provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries.

(ii) The company has not received any funds from any other person(s) or entity(ies) including foreign entities, with the understanding that the intermediary shall directlly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the company (ultimate beneficiaries) or provide any guarantee, security or the like to or on behalf of the Ultimate Beneficiaries.

l. Undisclosed Income:

During the year the Company has not disclosed any income in terms of any transaction not recorded in the books of accounts that has been surrendered or disclosed as income during the year in the tax assessments under the Income Tax Act, 1961 (such as, search or survey or any other relevant provisions of the Income Tax Act, 1961), unless there is immunity for disclosure under any scheme.

50 OPERATING SEGMENTS

The Board of the Company has been identified as the Chief Operating Decision Maker (CODM) as defined by Ind AS 108, “Operating Segments.” The Company’s operating segments are established in the manner consistent with the components of the Company that are evaluated regularly by the Chief Operating Decision Maker as defined in ‘Ind AS 108 - Operating Segments.’ The Company is engaged primarily in the business of financing and there are no separate reportable segments as per Ind AS 108.

a. Information about products and services:

The company deals in only one product i.e. granted loans to corporate customers. Hence, no separate disclosure is required.

b. Information about geographical areas:

The entire sales of the Company are made to customers which are domiciled in India. Also, all the assets of the Company are located in India.

c. Information about major customers (from external customers):

The Company does not earn revenues from the customers which amount to 10 per cent or more of Company’s revenues

51 TRANSFERS OF FINANCIAL ASSETS

In the ordinary course of business, the Company enters into transactions that result in the transfer of loans and advances given to customers. In accordance with the accounting policy set out in Note 2, the transferred financial assets continue to be recognised in their entirety or to the extent of the Company’s continuing involvement, or are derecognised in their entirety.

The Company transfers financial assets that are not derecognised in their entirety are primarily through the sale of NPA loans to asset reconstruction companies (ARCs).

A. Transferred financial assets that are not derecognised in their entirety Sale of NPA loans to asset reconstruction companies (ARCs)

Sale of NPA loans to asset reconstruction companies (ARCs)’ are transactions in which the Company sells loan and advances to an unconsolidated special vehicle and simultaneously purchases the majority portion of security receipts issued by said vehicle. The security receipts are collateralised by the loans purchased by the vehicle and hence the cash flow of the security receipts is dependent on the recovery of purchased loans.

The Company continues to recognise that part of the loans in their entirety against which security receipts have been subscribed by the Company because it retains substantially all of the risks and rewards of ownership w.r.t that part of the transferred loan. The part of loan transferred against which cash consideration is received is derecognised.

The following table sets out the carrying amounts and fair values of one financial asset transferred that is not derecognised in entirety and associated liabilities.

B. Valuation framework

The respective operational department performs the valuation of financial assets and liabilities required for financial reporting purposes, either externally or internally for every quaterly reporting period. Specific controls for valuation includes verification of observable pricing, review of siginificant unobservable inputs and valuation adjustments.

The Company measures fair values using the following fair value hierarchy, which reflects the significance of the inputs used in making the measurements.

Level 1: Inputs that are quoted market prices (unadjusted) in active markets for identical assets or liabilities.

Level 2 : The fair value of financial instruments that are not traded in active markets is determined using valuation techniques which maximize the use of observable market data either directly or indirectly, such as quoted prices for similar assets and liabilities in active markets, for substantially the full term of the financial instrument but do not qualify as Level 1 inputs. If all significant inputs required to fair value an instrument are observable the instrument is included in level 2.

Level 3 : If one or more of the significant inputs is not based in observable market data, the instruments is included in level 3. That is, Level 3 inputs incorporate market participants’ assumptions about risk and the risk premium required by market participants in order to bear that risk. It develops Level 3 inputs based on the best information available in the circumstances.

The objective of valuation techniques is to arrive at a fair value measurement that reflects the price that would be received to sell the asset or paid to transfer the liability in an orderly transaction between market participants at the measurement date.

The valuation techniques used in measuring Level 2 and Level 3 fair values for financial instruments measured at fair value in the balance sheet, as well as the significant unobservable inputs used.

C. Fair value hierarchy

This section explains the judgements and estimates made in determining the fair values of the financial instruments that are:

(a) recognised and measured at fair value and

(b) measured at amortised cost and for which fair values are disclosed in the financial statements.

To provide an indication about the reliability of the inputs used in determining fair value, the Company has classified its financial instruments into the three levels prescribed under the accounting standard. An explanation of each level follows underneath the table.

53 FINANCIAL RISK MANAGEMENT

The company’s activities are primarily subjected to credit risk, market risk and operational risk for managing risk management committee exsists. The function of the committee is to identify, monitor, manage and mitigate these risks. The company also makes sure that it adheres to internal policies and procedures, complies with the regulatory guidelines and maintains sufficient loan documentation.

With regards to its lending activity, the company has established various limits and restrictions to manage the risks. There are various reports which are prepared and presented to senior management by the risk management committee at regular intervals and on ad-hoc basis which helps in risk monitoring. The company has also set-up procedures to mitigate the risks in case of any breach.

A. Risk management framework

The Company’s Board of Directors have overall responsibility for the establishment and oversight of the risk management framework. The board of directors have established the Risk Management and Asset Liability Management Committee of the Directors (RALMCD) which is responsible for developing and monitoring the Company’s integrated risk management policies. The RALMCD is assisted in its oversight role by the Risk and Asset Liability Management Committee of Executives (RALMCE). The Integrated Risk Management Department undertakes regular reviews of risk management controls and procedures, the results of which are reported to the RALMCE on monthly basis.

B. Credit risk

Credit risk arises from loans and advances, cash and cash equivalents, investment in debt securties and deposits with banks and financial institutions and any other financial assets.

Credit risk is the risk of financial loss to the Company if a customer or counterparty to a financial instrument fails to meet its contractual obligations, and arises principally from the Company’s loans and advances to customers, trade receivables from customers; loans and investments in debt securities.

a) Credit risk management

The Company’s exposure to credit risk is influenced mainly by the individual characteristics of each customer/obligor. However, management also considers the factors that may influence the credit risk of its customer base, including the default risk associated with the industry, business specific risk, management risk, transition specific risk and project related risks.

A financial asset is considered ‘credit-impaired’ when one or more events that have a detrimental impact on the estimated future cash flows of the financial asset have occurred. Evidence that a financial asset is credit-impaired includes the following observable data:

- Significant financial difficulty of the issuer or the borrower

- A breach of contract, such as default

- The lender(s) of the borrower, for economic or contractual reasons relating to the borrower’s financial difficulty, having granted to the borrower concession(s) that the lender(s) would not otherwise consider

- It is becoming probable that the borrower will enter bankruptcy or other financial reorganisation

- The disappearance of the active market for that financial asset because of financial difficulties

- Purchase or origination of a financial asset at a deep discount that reflects the incurred credit loss

The risk management committee has established a credit policy under which each new customer is analyzed individually for credit worthiness before the Company’s standard payment and delivery terms and conditions are offered. The Company’s review includes minimum finalised internal rating, external ratings, if they are available, background verification, financial statements, income tax returns, credit agency information, industry information, etc. Credit limits have been established for each customer and reviewed periodically and modifications are done, as and when required. Any loan exceeding prescribed limits require approval from the respective competent authority.

b) Probablity of defalut (PD)

The Probability of Default (PD) defines the probability that the borrower will default on its obligations in the future. Ind AS 109 requires the use of separate PD for a 12 month duration and lifetime duration based on the stage allocation of the borrower. A PD used for Ind AS 109 should reflect the institution’s view of the future and should be unbiased (i.e. it should not include any conservatism or optimism).

To arrive at historical probability of default, transition matrix approach has been applied using IFCI internal obligor ratings.

c) Definition of default

Default’ has not been defined under Ind AS. An entity shall apply a default definition that is consistent with the definition used for internal credit risk management purposes and consider qualitative indicators when appropriate. A loan is considered as defaulted and therefore Stage-3 (credit impaired) for ECL calculations in the following cases:

- On deterioration of the IFCI internal combined ratings of the borrower to CR-9 or CR-10 (Comparison to be done between origination rating and current rating).

- On asset being classified as NPA as per RBI prudential norms

- On restructuring of assets with impairment in loan value

- On asset being more than 90 days past dues.

d) Exposure at default (EAD)

The exposure at default (EAD) represents the gross carrying amount of the financial instruments which is subject to the impairment calculation.

e) Loss given default (LGD)

LGD is an estimate of the loss from the transaction given that a default occurs. The LGD component of ECL is independent of deterioration of asset quality, and thus applied uniformly across various stages. With respect to loan portfolio, NPA accounts which have originated in past 7 years and have been closed, along with NPA accounts ageing more than 5 years (assumed as closed), have been considered for LGD computation.

f) Significant increase in credit risk

At each reporting date, an entity shall assess whether the credit risk on a financial instrument has increased significantly since initial recognition. When making the assessment, an entity shall use the change in the risk of the default occurring over the expected life of the financial instrument instead of the change in the amount of expected credit loss. To make that assessment, an entity shall compare the risk of a default occurring on the financial instrument as at the reporting date with the risk of a default occurring on the financial instrument as at the date of initial recognition and consider reasonable and supportable information, that is available without undue cost or effort, that is indicative of significant increases in credit risk since initial recognition. An entity may assume that the credit risk on a financial instrument has not increased significantly since initial recognition if the financial instrument is determined to have low credit risk at the reporting date.

For the assessment of the SICR for the loans and advances, the following conditions have been considered:

- Deterioration of the IFCI internal combined ratings of the borrowers by 3 rating grades. (Comparison to be done between origination rating and current rating).

- Deterioration of the ratings of the borrowers from the investment grade to the sub-investment grade.

- On restructuring of assets without impairment in loan value

- On asset overdue beyond 60 days past dues

g) Provision for expected credit losses

The following tables sets out information about the overdue status of loans and advances, loan commitments, financial guarantees, trades receivables and other financial assets to customers in Stages 1, 2 and 3.

k) Modified / Restructured loans

When the Company grants concession, for economic or legal reasons related to a borrower’s financial difficulties, for other than an insignificant period of time, the related loan is classified as a Troubled Debt Restructuring (TDR). Concessions could include a reduction in the interest rate below current market rates, payment extensions, forgiveness of principal, forbearance or other actions intended to maximize collection. Loans, for which the terms have been modified, and for which the borrower is experiencing financial difficulties, are considered TDRs.

From a risk management point of view, once an asset is forborne or modified, the Company’s special department for distressed assets continues to monitor the exposure until it is completely and ultimately derecognised.

A loan that is renegotiated is derecognised if the existing agreement is cancelled and a new agreement is made on substantially different terms or if the terms of the existing agreement are modified such that the renegotiated loan is a substantially different instrument.

Where the renegotiation of such loans are not derecognised, impairment continues to be assessed for significant increases in credit risk compared to the initial origination credit risk rating.

The are were no modified assets which were forborne during the period and accordingly no loss were suffered by the Company.

l) Governance Framework

As required by the RBI Notification no. “DOR (NBFC).CC.PD.No.109/22.10.106/2019-20 dated 13th March 2020, where provision requirement as per extant RBI norms is higher than ECL as computed under IndAS, the provision as per RBI norms shall be adopted, on portfolio basis. Further, in accordance with RBI Guidelines, where impairment allowance under Ind AS 109 is lower than the provisioning required under IRACP (including standard asset provisioning), the difference shall be appropriated from the net profit or loss after tax to a separate ‘Impairment Reserve’.

Liquidity risk is the potential inability to meet the institution’s liabilities as they become due. From IFCI perspective, it basically originates from the mismatches in the maturity pattern of assets and liabilities. Analysis of liquidity risk involves the measurement of not only the liquidity position of the institution on an ongoing basis but also examining how funding requirements are likely to be affected under sever but plausible scenarios. Net funding requirements are determined by analysing the institution’s future cash flows based on assumptions of the future behaviour of assets and liabilities that are classified into specified time buckets, utilizing the maturity ladder approach and then calculating the cumulative net flows over the time frame for liquidity assessment.

For the present, for measuring and managing net funding requirements, the use of maturity ladder and calculation of cumulative surplus or deficit of funds at selected maturity dates is being utilized as a standard tool.

The ALM format prescribed by RBI in this regard is being utilized for measuring cash flow mismatches in different time bands. The cash flows are placed in different time bands based on projected future behaviour of assets, liabilities and off-balance sheet items. Apart from the above cash flows, the institution would also track the impact of prepayments of loans, premature closure of liabilities and exercise of options built in certain instruments which offer put/call options after specified times. Thus, cash outflows can be ranked by the date on which liabilities fall due, the earliest date a liability holder could exercise an early repayment option or the earliest date contingencies could be crystallized.

The company has initiated an exercise to identify its High Quality Liquid Investments and compute Liquidity Coverage Ratio.

In addition, the Company maintains the following lines of credit:

- IDBI Bank: ' 110 Crore which is secured against FD with ROI 7.66% p.a.

- HDFC Bank : ' 16 Crore which is secured against MF with ROI MCLR of the month.

Market the risk that the fair value or future cash flows of financial instruments will fluctuate due to changes in market variables such as interest rates, foreign exchange rates and equity prices. In line with regulatory guidelines, the Company classifies exposures to market risk into either Current or Long term portfolios and manages each of those portfolios separately.

The market risk management framework in IFCI comprises risk identification, setting up of limits & triggers, risk measurement, risk monitoring, risk reporting and taking corrective actions where necessitated. It is pertinent to highlight that the details pertaining to threshold investment grade rating, investment limits, approval authority, control mechanism including stop-loss triggers, compliances required, etc. for different treasury products including equity trading have been clearly outlined in the extant Treasury & Investment Policy of IFCI.

(a) Market risk - trading portfolios

The Company does not have any trading portfolios.

(b) Market risk - Non-trading portfolios (i) Currency risk

The Company is exposed to currency risk to the extent that there is a mismatch between the currencies in which borrowings are denominated and the respective functional currencies of Company. The functional currency for the company is '. The currency in which these transactions are primarily denominated is EURO.

Currency risks related to the principal amounts of the Company’s EURO bank loans, have been fully hedged using forward contracts that mature on the same dates as the loans are due for repayment.

Generally, borrowings are denominated in currencies that match the cash flows generated by the underlying operations of the Company -primarily ' In addition, interest on borrowings is denominated in the currency of the borrowing. This provides an economic hedge without derivatives being entered into and therefore hedge accounting is not applied in these circumstances.

In respect of other monetary assets and liabilities denominated in foreign currencies, the Company’s policy is to ensure that its net exposure is kept to an acceptable level by buying or selling foreign currencies at spot rates when necessary to address short-term imbalances.

(iii) Equity price risk

Equity price risk is the risk that the fair value of equities declines as a result of changes in the level of equity indices and market price of individual stocks. The non-trading equity price risk exposure arises from equity securities classified at Fair Value. The equity price risk same is more applicable to securities held for the purpose of trading. As the Company focuses on long term investments and curent investments are kept low (investments held for tradng purposes), IFCI may not be exposed to significant equity price risk.

54 CAPITAL MANAGEMENT

The basic approach of capital adequacy framework is that, a financial institution should have sufficient capital to absorb shocks on account of any unexpected losses arising from the risks in its business.

As per RBI guidelines, IFCI as a Government owned NBFC-ND-SI is required to maintain a minimum capital to risk weighted asset ratio. Capital management entails optimal utilization of scarce capital to meet extant regulatory capital requirements. IFCI has put in place an appropriate Risk Appetite framework and computes its capital requirements and adequacy as per extant regulatory guidelines.

ii. Capital allocation

The amount of capital allocated to each operation or activity is undertaken with the objective of minimisation of return on the risk adjusted capital. Allocation of capital is to various lines of business basis annual business plan drawn at the beginning of the year. Various consideration for allocating capital include synergies with existing operations and activities, availability of management and other resources, and benefit of the activity with the company’s long term strategic objectives.

55 The following additional information is disclosed in terms of RBI Circulars applicable to Non-Banking Financial Companies. Ind AS adjsutements have not been made in these disclosures unless specifically stated :

(i) The company is registered with Securities and Exchange Board of India as debenture trustee having registration code i.e. “IND000000002”.

(ii) “ ‘There are no penalties imposed by RBI and other regulator during the year ended March 31, 2024. However, the Stock Exchanges had been imposing fines for non-compliance with the provisions of the SEBI (Listing Obligations & Disclosure Requirements) Regulations 2015, relating to composition of the Board of Directors and Committees namely Audit Committee, Nomination and Remuneration Committee, Stakeholders’ Relationship Committee and Risk Management Committee, in the absence of requisite number of Independent Directors on the Board of IFCI.

In response to the fines levied by the Stock Exchanges, it was submitted that being a Government Company, the power to appoint Independent Directors on the Board of IFCI Limited, vests with the Department of Financial Services, being the Administrative Ministry in charge. Once the

requiste number of Independent Directors are appointed, the Committees will be reconstituted as per the applicable regulatory provisions and the

Stock Exchanges were requested not to impose fine or to take any action on the Company.

Considering our submissions, BSE had waived the fines imposed for the above said non-compliances for the period ended upto December 31, 2020, except for an amount of ' 1,82,000 for Regulation 20 w.r.t. composition of Stakeholders’ Relationship Committee for the period ended June 30, 2020. No corresponding waiver has been granted by NSE yet. However, NSE had replied that waiver application can be placed only after the Company complies with the corresponding Regulations of SEBI Listing Regulations and advised IFCI to first appoint Directors as required to comply with applicable Regulations and subsequently apply for the waiver application.

As on date, the total consolidated outstanding fines imposed by the Stock Exchanges is ' 4,18,30,100/ -(inclusive of applicable taxes) for the quarters ended September 2018 to December 2023.

Further, upon our request, Government had appointed one Independent Director on the Board of the Company on May 10, 2023. Consequent to appointment of one (1) Independent Director, the composition of the Stakeholders’ Relationship Committee and Risk Management Committee has become compliant. Application for waiver of fines for these Committees had been submitted to the Stock Exchanges. Till the period ended March 2024, approval of Stock Exchanges was awaited. ”

(xlii) Breach of Covnants

There were no instances of default or breaches of covenant in respect of loan availed or debt securities issued during the financial years ended March 31, 2024.

(xliii) Divergence in Asset Classification and Provisioning

The RBI has neither assessed any additional provisioning requirements in excess of 5 percent of the reported profits before tax and impairment loss on financial instruments for the financial year ended March 31, 2024, nor identified any additional Gross NPAs in excess of 5% of the reported Gross NPAs for the said period.

59 Previous year figures have been re-grouped/ re-arranged/ restated wherever necessary, to conform to current period’s presentation.

In terms of our Report of even date

As per our report of even date attached For and on behalf of the Board of Directors of IFCI Limited

For S MANN AND COMPANY MANOJ MITTAL RAHUL BHAVE UMESH KUMAR GARG

Chartered Accountants Managing Director & Deputy Managing Independent Director

ICAI Firm registration No.: 000075N Chief Executive Officer Director DIN 00599426

DIN 01400076 DIN 09077979

CA SUBHASH CHANDER MANN SUNEET SHUKLA PRIYANKA SHARMA

Partner Chief General Manager & Company Secretary

Membership No.: 080500 Chief Financial Officer

Place: New Delhi Dated: 30 April 2024