IFCI reports Q4 loss of Rs 101 crore as NPA provision hiked

Infrastructure term lender IFCI Ltd today reported a loss of Rs 101 crore for the three-month period to March due to higher provisioning for bad loans as four assets turned non-performing.
The company had registered a net profit of Rs 120 crore in the corresponding January-March period of preceding fiscal ended March 2015.
"This has happened primarily because of one particular large account in the power sector. As per RBI norm, we had to provide additional amount including the interest reversal. So if you look at the fourth quarter, that one account has taken hit of Rs 188 crore," Chief Executive Officer and Managing Director Malay Mukherjee told reporters at the press meet.

"Barring there were slippages from telecom sector, where the company had to provide around Rs 90 crore and in the infrastructure sector we had to made some provisions," he said.
"There is also one very larger exporter of textile where company provided for provision of textile. So all this put together made to the loss," Mukherjee said.
IFCI's provisions towards bad loans and contingencies increased by Rs 321.77 crore from a year ago to Rs 484.35 crore for the last quarter of 2015-16.

However, the total income of the company increased to Rs 1,023.72 crore for the quarter ended March, from Rs 886.39 crore in the same period year ago.

For the full fiscal 2015-16, the company posted a net profit of Rs 337.45 crore, down from Rs 521.60 crore in 2014-15.
"Total income has increased to Rs 4,006.64 crore for the year ended March from Rs 3,46.08 crore year ago," it said.
Mukherjee said going forward, after June, the company would be able to do better.
The company's asset quality deteriorated during the quarter.
"Gross Non-Performing Assets (NPAs) and net NPAs as on March 31 have increased to 13.05 per cent and 9.54 per cent respectively vis-a-vis 10.28 per cent and 7.18 per cent as on March 2015, because of the downgrading of 15 standard accounts for 2015-16 (Rs 1,585 crore), including seven cases in fourth quarter of the fiscal (Rs 1,128 crore)," the company said.

As per IFCI's NPA resolution policy, going forward the company will be much more focussed towards reducing the bad loans.
"Internally, we have decided to reduce the 100 per cent of the NPAs that we have added in the last one year and 10 per cent of the previous NPAs," Mukherjee added.
Also, IFCI said the board at its meeting held today announced an interim dividend of 10 per cent, or Re 1 per share, for 2015-16.
Shares of the company closed 3.39 per cent higher at Rs 24.40 apiec on BSE on Friday.