IL&FS Financial Services (IFIN), the non-banking financial arm of the beleaguered Infrastructure Leasing and Financial Services (IL&FS), says it recovered Rs 1,380 crore till end-November 2019, from around 30 third-party borrowers and group entities.
IFIN has been classified a ‘red’ entity by the IL&FS board of directors. This means it cannot service debt obligations even towards senior secured financial creditors.
One of the key holding companies in the IL&FS group, it provided loans to various third-party borrowers and many entities of the group. As of end-March 2019, IFIN’s loan book was Rs 12,945 crore; of these, 96 per cent were non-performing. According to the latest report presented by the IL&FS board to the National Company Law Appellate Tribunal, gross non-performing assets (NPAs) were around 97 per cent of the loan exposure (at end-November).
The principal amount owed by third-party borrowers to IFIN was Rs 8,356 crore at end-October 2018. Of the Rs 1,310 crore recovered from these, Rs 1,050 crore is from its credit exposure (including interest) and Rs 260 crore under investment exposure. The new board of IL&FS has also recovered Rs 70 crore from three group entities.
Of the 30 third-party borrowers it has recovered money from, IFIN entered into resolutions with five, wherein the entire principal amount due of Rs 610 would be repaid, with applicable interest. Of this, Rs 130 crore towards principal and interest had been recovered by end-November and Rs 480 crore with interest is expected in the future.
Further, as of end-November, a total of 117 recovery actions had been initiated against third-party borrowers.
According to annual report of IFIN for 2018-19, the net loss was Rs 13,272 crore, compared to a net profit of Rs 9.5 crore in 2017-18. Net revenue fell 87 per cent to Rs 288.9 crore, from Rs 2,261.9 crore in FY18. Total borrowing as of end-March 2019 from various avenues (debt securities, bank loans, commercial paper, inter-corporate deposits) was Rs 14,916 crore.