Semianr IFCI

8/14/2019 Semianr IFCI

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A

Seminar Repor

On

lIFCI

(Industrial Financial Corporation of India)Session (2007-09)

Submitted to :- Submitted By:-

Mr. Harvinder ShyamaFaculty MBA Ist sem.JMIT, Ynr Roll No. 2007056

SETH JAI PARKASH INSTITUTE OF MANAGEMENT &

TECHNOLOGY

Radaur, Yamuna Nagar-135001

(Affiliated to Kurukshetra University,Kurukshetra)


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ABOUT IFCI

At the time of independence in 1947, Indias capital market was

relatively under-developed. Although there was significant demand

for new capital, there was a dearth of providers. Merchant bankers

and underwriting firms were almost non-existent. And commercial

banks were not equipped to provide long-term industrial finance in

any significant manner.

It is against this backdrop that the government established The

Industrial Finance Corporation of India (IFCI) on July 1, 1948, as the

first Development Financial Institution in the country to cater to the

long-term finance needs of the industrial sector. The newly-

established DFI was provided access to low-cost funds through the

central banks Statutory Liquidity Ratio or SLR which in turn enabled

it to provide loans and advances to corporate borrowers at

concessional rates.


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LIBERALISATION - CONVERSION INTO COMPANY IN 1993

This arrangement continued until the early 1990s when it was

recognized that there was need for greater flexibility to respond to

the changing financial system. It was also felt that IFCI should

directly access the capital markets for its funds needs. It is with this

objective that the constitution of IFCI was changed in 1993 from a

statutory corporation to a company under the Indian Companies

Act, 1956. Subsequently, the name of the company was also

changed to "IFCI Limited" with effect from October 1999.

FOCUS

IFCI has fulfilled its original mandate as a DFI by providing long-term

financial support to all segments of Indian Industry. It has also been

chiefly instrumental in translating the Governments development

priorities into reality. Until the establishment of ICICI in 1956 and

IDBI in 1964, IFCI remained solely responsible for implementation of

the governments industrial policy initiatives. Its contribution to the

modernization of Indian industry, export promotion, import

substitution, entrepreneurship development, pollution control,

energy conservation and generation of both direct and indirect


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employment is noteworthy. Some sectors that have directly

benefited from IFCIs disbursals include:

Consumer goods industry (textiles, paper, sugar);

Service industries (hotels, hospitals);

Basic industries (iron & steel, fertilizers, basic chemicals,

cement);

Capital & intermediate goods industries (electronics, synthetic

fibers, synthetic plastics, miscellaneous chemicals); and

Infrastructure (power generation, telecom services).

IFCI's ECONOMIC CONTRIBUTION

IFCIs economic contribution can be measured from the following: -

Cumulatively, IFCI has sanctioned financial assistance of Rs

462 billion to 5707 concerns and disbursed Rs 444 billion since

inception.

In the process, IFCI has catalysed investments worth Rs 2,526

billion in the industrial and infrastructure sectors.

By way of illustration, IFCIs assistance has been helped create

production capacities of:


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6.5 million spindles in the textile industry

7.2 million tons per annum (tpa) of sugar production

1.7 million tpa of paper and paper products

18.5 million tons tpa of fertilizers

59.3 million tpa of cement

30.2 million tpa of iron and steel

32.8 million tpa of petroleum refining

14,953 MW of electricity

22,106 hotel rooms

5,544 hospital beds

8 port projects, 66 telecom projects and 1 bridge project.

The direct employment generated as a result of its financial

assistance is estimated at almost 1 million persons.

IFCI has played a pivotal role in the regional dispersal of

industry -- 47% of IFCIs assistance has gone to 2,172 units

located in backward areas, helping to catalyse investments

worth over Rs1,206 billion.

IFCIs contribution to the Government exchequer by way of

taxes paid is estimated at Rs9 billion.

IFCI has played a key role in the development of cooperatives

in the sugar and textile sectors, besides acting as a nodal


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agency in both sectors. 371 cooperative societies in these

sectors have been assisted by IFCI.

IFCI has promoted Technical Consultancy Organizations

(TCOs), primarily in less developed states to provide necessary

services to the promoters of small- and medium-sized

industries in collaboration with other banks and institutions.

IFCI has also provided assistance to self-employed youth and

women entrepreneurs under its Benevolent Reserve Fund

(BRF) and the Interest Differential Fund (IDF).

IFCI has founded and developed prominent institutions like:

Management Development Institute (MDI) for

management training and development

ICRA for credit assessment rating

Tourism Finance Corporation of India (TFCI) for

promotion of the hotel and tourism industry

Institute of Labor Development (ILD) for

rehabilitation and training of displaced and retrenched

labor force

Rashtriya Gramin Vikas Nidhi (RGVN) for promoting,

supporting and developing voluntary agencies engaged

in uplifting rural and urban poor in east and northeast


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India.

IFCI, along with other institutions, has also promoted:

Stock Holding Corporation of India Ltd. (SHCIL)

Discount and Finance House of India Ltd. (DFHI)

National Stock Exchange (NSE)

OTCEI

Securities Trading Corporation of India (STCI)

LIC Housing Finance Ltd.

GIC Grih Vitta Ltd., and

Bio-tech Consortium Ltd. (BCL).

IFCI has also set up Chairs in reputed educational/

management institutions and universities. A major

contribution of IFCI has been in the early assistance providedby it to some of todays leading Indian entrepreneurs who may

not have been able to start their enterprises or expand without

the initial support from IFCI.

CORPORATE STRATEGY


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IFCI has been able to achieve a financial turnaround

with the consistent support and cooperation of all its

stakeholders and is now endeavouring to re-position

itself .

As a part of its organizational strategy, IFCI plans to

induct strategic investor(s) who may provide

besides funds support, business know-how,

marketing techniques, technology, clientele, brand

name etc. to achieve scale and scope economies

and provide expansion of the capital and resources

base. In the interim period, IFCI plans to enhance

organizational value through better realization of its

Non-performing Assets (NPAs) and unlocking of

value of its investment port-folio including unquoted

investments as well as real estate assets.

The present business strategy of IFCI envisages (a)

retaining and enhancing its core competence in long

term lending to industrial and infrastructure sectors

and (b) expanding fee-based businesses to

capitalize on emerging opportunities in Corporate

Advisory Services.


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Board of Directors

Shri Atul Kumar Rai, , ChiefExecutive Officer & Managing

Director is B.A. (Hons.)Economics from University ofDelhi and hold postgraduatequalification in Economics from

Jawahar Lal Nehru University.Shri Rai has rich experience ofover 20 years and had heldvarious posts in the Governmentof India, including as Director inDDA, Banking Division in Ministry

of Finance. He is presently alsoon the Board of Directors of

Tourism Finance Corporation ofIndia Ltd., GIC Housing FinanceLtd., IFCI Financial Services Ltd.,IFCI Venture Capital Fund Ltd.,Assets Care Enterprise Ltd., IIBIand Haldia Petrochemicals Ltd

Smt Sukriti Likhi nomineeGovt. of India

Shri R.C. Razdan, ChiefGeneral Manager in IDBI BankLtd., is Post Graduate inMarketing Management. He hasrich experience of over 30 yearsin Commercial and DevelopmentBanking in various capacities. Heis IDBI nominee on the Board ofBhandari Exports Ltd.


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Shri S. Ravi is a practicingChartered Accountant andfounder member of Ravi Rajan &Co. He is on the Board ofCorporation Bank, IDBI Capital

Market Services Limited, BatiliboiLimited, Mahindra Ugine SteelCo. Ltd., Spectrum PowerGeneration Ltd. Gujarat PipavavPort Ltd., LIC Housing FinanceLtd, IDBI Home finance Limited,Kudremukh Iron Ore CompanyLtd., Hindustan Aeronautics Ltd.,Management DevelopmentInstitute (MDI), UTI Trustee

Company Pvt. Ltd.

Shri Thomas Mathew T.,Managing Director, LIC. MA.(Eco), LLB, PGDM, AIII, is havingvery rich and varied experiencein both national and Internationaloperations of LIC. He is also adirector in LIC Housing Finance

Ltd., LIC Care Homes Ltd., LIC(Lanka) Ltd., Saudi IndianInsurnace Co. Riyadh, Mahindra &Mahindra Ltd. and Larsen &

Toubro Ltd.,

Shri P.G. Muralidharan,former Secretary toGovernment of India, has more

than 34 years of rich experienceof various Ministries of Central &State Govts. He had beenChairman of various PSUs. Hehad led Government delegationto various foreign countries forimportant assignments.


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Shri P.S. Shenoy is formerChairman & ManagingDirector of Bank of Baroda.

He is banker by professionhaving overall rich experience ofmore than 38 years in Banking &Finance. He is also a director inSIDBI Venture Capital Ltd., ICRAManagement ConsultingServices Ltd., Torrent Power Ltd.,Investment and PrecisionCastings Ltd., Chartered FinanceManagement Ltd.

Prof. Shobhit Mahajan,Director, Delhi UniversityComputer Center, has done hisM.S. (Physics) and Ph.D (Physics)from University of California,Berkeley. He has rich experience

of research and teaching in theUniversity of Delhi andCalifornia. He has authoredseveral books on science andcomputer. Prof. Mahajan doesnot hold Directorship/Committeemembership in any othercompany.


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Products and Services

Areas of Operations

The lending policies of IFCI have evolved

over the last five decades of operations.

These policies have sought to achieve the

primary objective of providing medium

and long-term financial assistance to

mainly manufacturing concerns and to

fulfill the overall goals of industrial and

economic development in India. The

principal activities of IFCI include:

Project finance Financial services Non-project specific assistance

Corporate Advisory Services

i. Project finance involves providing credit and other

facilities to green-field industrial projects (including

infrastructure projects) as well as to brown-field projects,

viz., expansion, diversification and modernization of

existing industrial concerns through various types of
http://www.ifciltd.com/corporate_advisory.htmhttp://www.ifciltd.com/corporate_advisory.htm


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assistance that are tailored to the borrowers needs.

ii. Financial services covers a wide range of activities

wherein assistance is provided to existing concerns

through various schemes for the acquisition of assets, as

part of their expansion, diversification and modernization

programs. These schemes are also extended to

equipment which could be directly got fabricated by the

actual user, or procured from domestic suppliers, or

imported. Tailor-made schemes to suit the individual

borrower's requirements have been designed to provide

quick funds after a need-based appraisal. The interest

rate and rentals (in case of equipment leasing) are

competitive and determined on the basis of the risk

perception about individual concerns.

iii. Non-project specific assistance is provided mainly in the

form of corporate / short-term loans, working capital, bills

discounting, etc to meet expenditure, which is not

specifically related to any particular project.


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IT ServicesIFCI has been evolving over the years to meet the needs of its

customers and has been taking the help of technology to move

forward. With this aim IFCI set up its full-fledged IT department in the

year 1985. The core team of professionals in the department has

helped IFCI adapt to various technologies and enabled IFCI to become

one of the top 100 IT Users in the country (MIS Dec. 99). With this

vast in-house experience, IFCI has now started providing total IT

solutions to various Business Houses/Financial Institutions and also its

Subsidiaries & Associates.

Mission

To be among the leading IT solution providers in the country. To

share the expertise gained in operation and continue to develop new

competencies in emerging technologies so as to come up with

mutually beneficial solution to customers.

Goal

To provide innovative and cost effective solutions to clients with

a blend of traditional and latest technologies maximising value

at the least cost..


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To provide maximum service at least cost and shorter turn-

around times.

To develop long term relationship with our clients

Our Team

IFCI's strength has always been its People and the convergence of

their minds. They are highly skilled developers comprising Software

Technologists, Finance & Domain Specialists, selected with great care

and located over 12 offices of the Company all over the country. They

are dedicated Software Specialists, fully equipped to provide total

support to the customers.

Strengths and Expertise

Over the years IFCI's IT Group has gained considerable knowledge


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and expertise in the following areas in IT domain as well as in the

financial domain being part of the premier financial Institution

Complete IT solutions using state-of-the-art technologies for

multifaceted business environments.

Complete IT strategy planning for large

geographically dispersed organisations.

Web-enabling of applications for

users/customers/citizens direct access to the information.

ApplicationSystems suitable for financial/manufacturing sector

using latest technologies.

Planning of Computing Environment, Sizing of Hardware

Evaluation and Selection of Database Engines

Creation of LAN of computers.

WIDE Area Networking of Computer Systems (WAN), Virtual

Private Networking (VPN)

Structured Cabling Systems.

Operations Management, LAN, WAN & ORACLE Database (DBA)

Administration.

Facilities Management

Data, Voice, Video, VOIP, Imaging & Document Management


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System

Data Migration.

Systems Integration.

Groupware Applications using Lotus Notes.

Shared Databases

Workflow Applications

Knowledge Management

Migration from client server computing to server based

computing through CITRIX Metaframe Software - Installation &

Administration

Setting up of Corporate email facility, post-office protocols -

Installation & Administration.

Web Designing, Administering Servers & Installation.


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PROJECT ADVISORY & FINANCEAt a time when India is throwing up investment avenues in newer

sectors and projects, there is a critical need to provide specialised

advisory services to the Indian Corporate Sector in their efforts towards

Industrial Advancement.

As a catalyst of Industrial growth, IFCI provides the followingproject Advisory Services:

Investment appraisal of Navratna (most valued public sector

companies) Companies

Project Conceptualization and related services, including

Guidance in relation to Selection of Projects, Preparation of

feasibility studies, DPR, Capital Structuring, Techno-economic

Feasibility, Financial Engineering, Project Management Design

etc.

Credit Syndication including preparation of Information

Memorandum, Syndication of domestic/foreign loans, post

sanction Follow-up, assistance in Legal Documentation etc

Documentation of various project documents.

INFRASTRUCTURE ADVISORY


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Assets available for Sale

Where Sale Notices have been issued(i) by Official Liquidator(ii) by Recovery Officer

(iii) Under Securitisation Act 2002(iv) by other InstitutionsWhere(i) Recovery Certificates have been issued By DRTs(ii) Liquidation Proceeding is Pending

This section has two parts. Part A gives the names of Companies

where Sale Notices have been issued by the Official Liquidators

attached to the High Courts and / or by the Recovery Officers

attached to Debt Recovery Tribunals (DRTs) and / or under

Securitisation Act 2002. Part B gives the names of cases where

execution proceedings before Recovery Officers of DRTs are pending

and/or cases where liquidation proceedings before Official Liquidators

attached to High Courts are on.

To peruse the notices published in respect of cases of Part-A and to

get the details of Company Profile in respect of cases of Part B

interested buyers may click the name of the 'Company' listed below.


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IFCI VENTURE CAPITAL FUNDS LTD.

(IVCF)IFCI Venture Capital Funds Ltd. (IVCF) was originally set up by

IFCI as a Society by the name of Risk Capital Foundation (RCF) in

1975 to provide institutional support to first generation

professionals and technocrats setting up their own ventures in

the medium scale sector, under the Risk Capital Scheme. In

1988, RCF was converted into a company, Risk Capital and

Technology Finance Corporation Ltd. (RCTC), when it also

introduced the Technology Finance and Development

Scheme for financing development and commercialisation of

indigenous technology. To reflect the shift in the companys

activities, the name of RCTC was changed to IFCI Venture Capital

Funds Ltd. (IVCF) in February 2000.

Over the years, IVCF has provided financial assistance to new

ventures, supported commercialisation of new technologies,


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