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BSE: 500106 Sector: Financials
NSE: IFCI ISIN Code: INE039A01010
BSE 10:42 | 21 Oct 5.87 0.08






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OPEN 5.99
VOLUME 97166
52-Week high 9.31
52-Week low 3.10
Mkt Cap.(Rs cr) 1,113
Buy Price 5.87
Buy Qty 451.00
Sell Price 5.88
Sell Qty 2782.00
OPEN 5.99
CLOSE 5.79
VOLUME 97166
52-Week high 9.31
52-Week low 3.10
Mkt Cap.(Rs cr) 1,113
Buy Price 5.87
Buy Qty 451.00
Sell Price 5.88
Sell Qty 2782.00

IFCI Ltd. (IFCI) - Director Report

Company director report

To the Members

The Board of Directors of your Company presents the Twenty Fourth Annual Report of IFCILimited together with the Audited Financial Statements for the year ended March 31 2017.


(Rs. crore)
PARTICULARS FY 2016-17 FY 2015-16 (Regrouped)
1. Operational Income 2740 3819
2. Total Income 2874 4007
3. Cost of Borrowings 2289 2517
4. Staff Cost /Other Expenditure 138 137
5. Depreciation 34 14
6. Total Expenditure 2462 2669
7. Profit Before Provisions /Write-off 413 1338
8. Provision for Bad & Doubtful Assets and Others (Net of Write off) 1192 895
9. Profit/(Loss) Before Tax (779) 443
10. Tax Expense (321) 106
11. Profit/(Loss) After Tax (458) 337
12. Surplus Brought forward from Previous year 1924 1923
13. Appropriations :
Reserve u/s 45IC of RBI Act - -
Special Reserve u/s 36(1)(viii) of the Income Tax Act - 55
Debenture Redemption Reserve 76 76
Expenditure on Corporate Social Responsibility Activities - 7
Dividend on Equity Shares (incl. tax) - 198
Dividend on Preference Shares (excl. Tax) 0* 0*
14. Balance carried to Balance Sheet 1389 1924

*0.26 crore.

The financial statements of your Company have been prepared in accordance with theapplicable Accounting Standards RBI Guidelines Schedule III of the Companies Act 2013and other applicable laws/regulations.

Reduction in operational income was the result of decline in loan assets due to lowcredit offtake coupled with prepayment of certain loans reversal of unrealised interestpertaining to previous year in respect of new NPAs increase in proportion ofnon-recognition of interest income on accrual basis due to increase in NPAs failure inimplementation of certain SDR and S4A cases under consortium lending stricter RBI normswith regard to slippage of standard assets to NPAs and further downgradation within NPAsas compared to norms in the previous year.

The borrowing cost was lower compared to the previous year on account of reduction ininterest rates of existing borrowing fresh raising of funds at lower cost and prepaymentof certain high cost borrowing.

The operation wise segregation of operational income is depicted in the chart below:


Your Company paid dividend of Rs.0.26 crore on preference shares. However in view ofthe loss incurred during the year and with a view to preserving capital and cash forfuture growth no dividend has been recommended on equity shares. Also as per theprovisions of SEBI (Listing obligations and Disclosure Requirements) Regulations 2015the Company has formulated a Dividend Distribution Policy which is enclosed at Annexure-I.The Dividend Distribution Policy is also available on the website of the Company


There has been no change in the business of the Company during the reporting period.Further there have been no material changes and commitments which affect the financialposition between the end of financial year and date of Board's Report.


There was no change in the ownership of the Government of India in your Company duringFY 2016-17 and it continued to hold 51.04% in the paid-up share capital in IFCI as onMarch 31 2017. There has also been no change in the capital structure of the Company.

The change in the debt structure of the Company is as under:

Total Number of Securities at the beginning of the year Issued during the year Redemption made during the year Total Number of Securities at the end of the year
4221261443 5750 218718 4221048475

Details of Debenture Trustee

As per the provisions of SEBI (Listing Obligations and Disclosure Requirements)Regulations 2015 the relevant details of the Debenture Trustees are as under:

Name of the Debenture Trustee Contact Details
Axis Trustee Services 2nd Floor-E Axis House
Limited Bombay Dyeing Mills Compound
Pandurang Budhkar Marg
Worli Mumbai-400025
IDBI Trusteeship Asian Building Ground Floor
Services Limited 17 R. Kamani Marg Ballard Estate
Centbank Financial 3rd Floor (East Wing)
Services Limited Central Bank of India MMO Building
55 M G Road Mumbai-400001


Since the last Board Report there have been some changes in the composition of theBoard of Directors. During the year 2016-17 Ministry of Finance had vide its order datedJuly 6 2016 appointed Shri R N Dubey (DIN: 07561054) on the Board of the Company viceShri Alok Tandon (DIN: 01841717). Also during the year Prof N Balakrishnan (DIN:00181842) upon his retirement as NonExecutive Director ceased to be on the Board of theCompany. Shri Malay Mukherjee (DIN: 02272425) and Shri Achal Kumar Gupta (DIN: 02192183)ceased to be on the Board upon completion of their tenure as CEo and Managing Director andDeputy Managing Director respectively. Also Shri S V Ranganath (DIN: 00323799) Smt.Savita Mahajan (DIN: 06492679) and Shri K S Sreenivasan (DIN: 05273535) ceased to be onthe Board of the Company upon completion of their tenure as Independent Directors.Further Ministry of Finance vide its order dated December 9 2016 appointed Shri SanjeevKaushik (DIN: 02842527) as Deputy Managing Director in additional charge.

Apart from the above there has been no other change in the Composition of the Board ofDirectors and Key Managerial Personnel during the year.


Ms Kiran Sahdev (DIN: 06718968) will retire by rotation at the conclusion of theforthcoming Annual General Meeting and being eligible has offered herself forre-appointment.


The details of the Meetings of the Board of Directors forms part of the CorporateGovernance Report appearing separately in the Annual Report.


The details of Composition form part of the Corporate Governance Report appearingseparately in the Annual Report. There has been no matter where the Board has not acceptedrecommendations of the Committee.


Pursuant to the provisions of the Companies Act 2013 and Listing Regulations whereverapplicable the Company has put in place a Nomination as well as a Remuneration Policy.Vide Notification No. F.No. 1/2/2014-CL.V dated June 5 2015 in case of GovernmentCompanies Section 134(3)(e) of the Companies Act 2013 shall not apply. Accordingly therequisite Policy has not been made part of Board's Report.


Disclosure on Related Party Transactions during FY 2016-17 in the prescribed Form AOC-2is provided in Annexure II.


I. Approval by Audit committee

1. All Related Party Transactions (RPTs) (including any subsequent modificationsthereof) shall require prior approval of the Audit Committee of Directors.

2. The Audit Committee of Directors may grant omnibus approval for the RPTsproposed to be entered into by the Company.

The Conditions for granting omnibus approval are as under:

All related party transactions shall require approval of the Audit Committee and theAudit Committee may make omnibus approval for related party transactions proposed to beentered into by the Company subject to the following conditions namely:-

1. The Audit Committee shall after obtaining approval of the Board of Directorsspecify the criteria for making the omnibus approval which shall include the followingnamely:-

(a) maximum value of the transactions in aggregate which can be allowed under theomnibus route in a year;

(b) the maximum value per transaction which can be allowed;

(c) extent and manner of disclosures to be made to the Audit Committee at the time ofseeking omnibus approval;

(d) review on quarterly basis or at such intervals as the Audit Committee may deemfit related party transaction entered into by the Company pursuant to each of the omnibusapproval made;

(e) transactions which cannot be subjected to the omnibus approval by the AuditCommittee.

2. The Audit Committee shall consider the following factors while specifying thecriteria for making omnibus approval namely:

(a) repetitiveness of the transactions (in past or in future);

(b) justification for the need of omnibus approval.

3. The Audit Committee shall satisfy itself on the need for omnibus approval fortransactions of repetitive nature and that such approval is in the interest of theCompany.

4. The omnibus approval shall contain or include the following:-

(a) name of the related parties;

(b) nature and duration of the transactions;

(c) maximum amount of transaction that can be entered into;

(d) the indicative base price or current contracted price and the formula for variationin the price if any; and

(e) any other information relevant or important for the Audit Committee to take adecision on the proposed transaction:

Provided that where the need for related party transaction cannot be foreseen and theaforesaid details are not available audit committee may make omnibus approval for suchtransactions subject to their value not exceeding Rs.1 crore per transaction.

5. omnibus approval shall be valid for a period not exceeding one financial year andshall require fresh approval after the expiry of such financial year.

6. Omnibus approval shall not be made for transactions in respect of selling ordisposing of the undertaking of the Company.

7. Any other conditions as the Audit Committee may deem fit.

II. Approval by Board of Directors

Except with the consent of the Board of Directors given by a resolution at a meeting ofthe Board IFCI shall not enter into any contract or arrangement with a related party withrespect to:

(a) Sale purchase or supply of any goods or materials;

(b) Selling or otherwise disposing of or buying property of any kind;

(c) Leasing of property of any kind;

(d) Availing or rendering of any services;

(e) Appointment of any agent for purchase or sale of goods materials services orproperty;

(f) Such related party's appointment to any office or place of profit in the companyits subsidiary company or associate company; and

(g) Underwriting the subscription of any securities or derivatives thereof of thecompany:

Provided that nothing of the above shall apply to any transactions entered into byIFCI in its ordinary course of business other than transactions which are not on an arm'slength basis.


The expression "office or place of profit" means any office or place: Wheresuch office or place is held by a director if the director holding it receives from IFCIanything by way of remuneration over and above the remuneration to which he is entitled asdirector by way of salary fee commission perquisites any rent- free accommodation orotherwise;

Where such office or place is held by an individual other than a director or by anyfirm private company or other body corporate if the individual firm private company orbody corporate holding it receives from IFCI anything by way of remuneration salary feecommission perquisites any rent-free accommodation or otherwise;

The expression "arm's length transaction" means a transaction betweentwo related parties that is conducted as if they were unrelated so that there is noconflict of interest.

III. Approval by shareholders

1. Except with the prior approval of the company by a special/ordinary resolution asmay be specified under the Companies Act 2013 or the Regulations IFCI shall not enterinto a transaction(s) where the transaction(s) to be entered into:

(a) as contracts or arrangements with respect to clauses (a) to (e) of sub-section (1)of Section 188 of the Companies Act 2013 with criteria as mentioned below:

(i) Sale purchase or supply of any goods or materials directly or through appointmentof agent amounting to 10% or more of the turnover of the company or Rs.100 croreswhichever is lower as mentioned in clause (a) and clause (e) respectively of sub-section(1) of Section 188;

(ii) Selling or otherwise disposing of or buying property of any kind directly orthrough appointment of agent amounting to 10% or more of net worth of the company orRs.100 crores whichever is lower as mentioned in clause (b) and clause (e) respectivelyof sub-section (1) of Section 188;

(iii) leasing of property of any kind amounting to 10% or more of the net worth of thecompany or 10% or more of turnover of the company or Rs.100 crores whichever is lower asmentioned in clause (c) of sub-section (1) of Section 188;

(iv) availing or rendering of any services directly or through appointment of agentamounting to 10% or more of the turnover of the company or Rs.50 crores whichever islower as mentioned in clause (d) and clause (e) respectively of subsection (1) of Section188.

Explanation: It is hereby clarified that the limits specified in sub-clauses (i) to(iv) as above shall apply for transaction or transactions to be entered into eitherindividually or taken together with the previous transactions during a financial year.

(b) Is for appointment to any office or place of profit in the Company its subsidiarycompany or associate company at a monthly remuneration exceeding Rs.2.5 lakh as mentionedin clause (f) of sub-section (1) of Section 188; or

(c) Is for remuneration for underwriting the subscription of any securities orderivatives thereof of the company exceeding 1% of the net worth as mentioned in clause(g) of sub-section (1) of Section 188.


(1) The Turnover or Net Worth referred in the above subrules shall be computed on thebasis of the Audited Financial Statement of the preceding financial year.

(2) In case of a wholly owned subsidiary the special resolution passed by the IFCIshall be sufficient for the purpose of entering into the transactions between the whollyowned subsidiary and IFCI.

2. All the related parties shall abstain from voting on such resolutions.

3. No Member of IFCI shall vote on such Special/Ordinary Resolution (as the case maybe) to approve any contract or arrangement which may be entered into by the Company ifsuch member is a related party.


The above clauses II and III with respect to the Approval of Board and Shareholder'srespectively will not be applicable in the following cases:

1. Transactions entered into between 2 Government Companies.

2. Transactions entered into between a holding company and its wholly owned subsidiarywhose accounts are consolidated with such holding company and placed before theshareholders at the general meeting for approval.


Pursuant to the provisions of the Companies Act 2013 the extract of the Annual Returnin the prescribed format of Form MGT-9 is placed at Annexure-III.


The Disclosure of contents of Corporate Social Responsibility Policy in the Board'sReport pursuant to the provisions of Companies (Corporate Social Responsibility Policy)Rules 2014 is at Annexure-IV.


The requisite details envisaged under the provisions of Rule V of Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014 are annexed with thisreport at Annexure-V.


The requisite details pursuant to the provisions of SEBI (Share Based EmployeeBenefits) Regulations 2014 and pursuant to the provisions of Rule 12 (9) of the Companies(Share Capital and Debentures) Rules 2014 are at Annexure-VI. Though the ESOPScheme has been discontinued the disclosures are made in term of the above Guidelines.


The performance evaluation of the Board its Committees and individual Directors wasconducted by the Nomination and Remuneration Committee and the Board.

Since there is only 1 Independent Director on the Board of the Company hence noMeeting of the Independent Directors could be held. As directed by the Nomination andRemuneration Committee of Directors a communication requesting appointment of requisitenumber of Independent Directors has been sent to the Administrative Ministry.


An Internal Complaints Committee has been formed and the details of the Members of thesaid Committee at IFCI are as under:

1. Ms. Parul Khosla External Member
2. Ms. Pooja Mahajan General Manager (HR)
3. Ms. Rupa Deb General Manager
4. Ms. Pooja Tiku Deputy General Manager (Legal)
5. Mr. Ravish Jain Assistant General Manager

In the absence of any of the aforesaid members Ms. Sara Najmi Assistant GeneralManager (Legal) would be the alternate Member.


As the Company is primarily engaged in the business of financing Companies in thecapacity of being a Non-Banking Financial Company therefore the provisions of Section 186[except for subsection (1)] of the Companies Act 2013 are not applicable to the Company.


Disclosure indicating development and implementation of a Risk Management Policy isprovided in the Management Discussion and Analysis Report forming part of this Report.


Your Company did not raise any public deposit during the year. There was no publicdeposit outstanding as at the beginning or end of the year as on March 31 2017.


No Director of the Company including the CEo & MD and DMD was paid any commissionduring the FY 2016-17 from any of the subsidiary of your Company on whose Boards theywere Directors as nominees of your Company.


The Supreme Court in W.P. (Civil) No.355 of 2011 filed by Centre for Public LitigationVs. Union of India & others vide its order dated 23-09-2016 has directed that ascrutiny be conducted by Reserve Bank of India (RBI) Securities and Exchange Board ofIndia (SEBI) & Serious Frauds Investigation office taking into consideration thevarious allegations of administrative and financial irregularities during the period2008-2012 in IFCI and report be submitted to Union Government for taking further actionin the matter. The scrutiny was conducted by the respective authorities. However theorder at present has no impact on the operations as a going concern.


During 2016-17 IFCI reviewed and modified its Vigilance Policy & Manual on thelines of CVC directives with the approval of the Board of Directors. The modificationshave further streamlined vigilance activities in IFCI and provided clarity on severalissues for smooth conduct of inquiries and disciplinary proceedings.

During the year Vigilance Department has organised following training/workshopprogrammes:

(a) CVC Guidelines on complaints.

(b) Lodgment of complaint under Whistle-blower Portal of IFCI.

(c) Compilation of FFo Reports

(d) Preventive Vigilance & Staff Accountability

(e) A lecture by senior official from CVC on "Preventive Vigilance in Loans".

(f) Workshop on preventive vigilance in credit appraisal.

The Vigilance Department has also undertaken following initiatives for improvement insystem and procedures at IFCI:

(i) For sale of fixed assets e-auction route has been made compulsory.

(ii) E-Procurement has been made mandatory.

(iii) Preventive vigilance in lending practices.




Stock Holding corporation of India Ltd (SHciL)

Stock Holding Corporation of India Ltd (SHCIL) a subsidiary of IFCI Limited waspromoted by the public financial institutions and incorporated as a public limited companyon July 28 1986. SHCIL one of the largest Depository Participants besides being thecountry's largest premier Custodian in terms of assets under custody provides posttrading and custodial services to institutional investors mutual funds banks insurancecompanies etc. SHCIL acts as a Central Record Keeping Agency (CRA) for collection ofstamp duty in 19 States and Union Territories on pan India basis. SHCIL is one of thelargest Professional Clearing Member of the country.

SHCIL distributes GOI Bonds Sovereign Gold Bonds Fixed Deposits Corporate Bonds andNCDs of reputed Institutes & Corporates Mutual Fund Schemes Initial Public offerings(IPos) and National Pension System (NPS) etc. SHCIL operates through its 186 retailbranches all over India. SHCIL has been profit making and dividend paying company rightfrom its inception. As on date IFCI holds 52.86% shareholding in SHCIL making it asubsidiary Company of IFCI.

SHCIL bagged the prestigious NSDL Star performer award continuously for 2014 2015 and2016 for top performer in highest asset value and top performer in active accounts. SHCILhas bagged BSE's Skoch Award for Best Custodian- Business Excellence in 2016. SHCIL hasbeen rated by the internationally circulated and reputed Global Custodian magazine in theyear 2016. SHCIL was awarded prizes in Best Point of Presence (PoP)-All Citizen awardBest PoP NPS Corporate and Best PoP NPS Private Sector in 2016.

SHCIL has two wholly owned subsidiaries viz.

(i) SHCIL Services Ltd (SSL) and

(ii) Stock Holding Document Management Services Limited (StockHolding DMS) (erstwhileSHCIL Projects Ltd).

SSL the broking arm of SHCIL is providing stock broking services to retail andinstitutional clients across the country. SSL offers services in Cash & F&osegment of BSE & NSE. StockHolding DMS is a Microsoft Gold certified partner for allits products and services and is ISo 9001:2008 and CMMI Level-3 certified company.StockHolding DMS provides End to End Document Management Solutions.

IFCI Infrastructure Development Ltd (IIDL)

IFCI Infrastructure Development Ltd (IIDL) was set up by IFCI Limited in the year 2007to venture into the real estate and infrastructure sector as a wholly owned subsidiary ofIFCI Ltd. IIDL has ventured into the Infrastructure Sector as an institutional player. Thecompany since its inception has developed projects all over India focusing onconstruction that is driven by the overall infrastructure development of the country.Besides re-development modernization ownership and management of properties owned byIFCI IIDL strategically develops properties acquired through NPA resolution from variousBanks and FIs or directly obtained from the Development Authorities.

IIDL has been appointed as the Project Management Consultants for developing"Management Development Institute" Murshidabad West Bengal a sprawlingresidential campus spreading over 10 Acres of land on Turnkey basis. The Project wasinaugurated on August 24 2014 by Hon'ble President of India Shri Pranab Mukherjee alongwith Finance Minister Shri Arun Jaitley.

This apart IIDL is also getting into Engineering Consultancy/PMC to increase itsReturn on Equity (RoE).

IFCI Venture Capital Funds Ltd (IFCI Venture)

IFCI Venture was set-up in 1975 by your Company with the objective to broadenentrepreneurship base in India by providing risk capital mainly to first generationentrepreneurs under "Risk Capital Scheme". In 1988 IFCI Venture launched"Technology Finance & Development Scheme" to provide financial assistancefor setting up projects aimed at commercialization of indigenous technologies. In 1991IFCI Venture took up management of a Venture Capital Fund named VECAUS-III floated bySUUTI and IFCI to promote varied projects across industrial sectors of Indian geography.VECAUS-III was closed in the year 2007 and outstanding portfolio companies weretransferred to SUUTI. The Fund was officially closed through sale of portfolio in FY2011-12.

In the year 2014-15 IFCI Venture initiated setting-up of three funds viz.

(a) Venture Capital Fund for Scheduled Castes (VCF-SC) -As on March 31 2017 65proposals aggregating to Rs.236.66 crore have been sanctioned and Rs.115.27 crore havebeen disbursed to 34 beneficiaries.

(b) Green India Venture Fund-II (GIVF-II)

(c) Small and Medium Enterprises Advantage Fund (SMEAF)

For both the above two funds viz. GIVF-II & SMEAF SEBI approval has been receivedand IFCI Limited has committed Rs.50 crore in each Fund. IFCI Venture is raising thecorpus of the funds from the domestic market to start operations during FY 2017-18.

IFCI Venture is also registered with RBI as an NBFC and provides secured CorporateLoans to small and mid-size companies. The Company has a well-defined credit policy forits credit business.

As on date IFCI holds 98.59% shareholding in IFCI Venture making it a subsidiaryCompany of IFCI.

IFCI Financial Services Ltd (IFIN)

IFIN was set up in 1995 by your Company to provide a wide range of financial productsand services to institutional and retail clients. IFIN is primarily involved in thebusiness of Stock Broking Currency Trading Depository Participant Services Merchant andInvestment Banking Insurance (Corporate agent for both life and General Insurance)Mutual Fund Products Distribution and Corporate Advisory Services.

IFIN is a registered member of SEBI National Stock Exchange of India Limited (NSE)BSE Limited (BSE) Metropolitan Stock Exchange of India Limited (MCX-SX) NationalCommodity and Derivatives Exchange Limited (NCDEX) NSDL and CDSL. IFIN has threewholly-owned subsidiaries namely IFIN Securities Finance Ltd IFIN Commodities Ltd andIFIN Credit Ltd.

IFIN Securities Finance Ltd an NBFC is primarily engaged in the business of marginfunding providing loan against shares & property promoter funding etc. to variousclients. Being an NBFC it is registered with RBI. IFIN Commodities Ltd a registeredmember of the Multi Commodity Exchange of India Ltd (MCX) NCDEX and National SpotExchange Limited (NSEL) is primarily engaged in the business of providing commoditymarket related transaction services. IFIN Credit Ltd is not engaged in any major businessactivity. As on date IFCI holds 94.78% shareholding in IFIN making it a subsidiaryCompany of IFCI.

IFCI Factors Ltd (IFL)

IFL is a major provider of factoring services in India. The Company also offersCorporate Loan for a tenor of upto five years. The FY 201617 has been a tough year for theCompany witnessing a reduction in income coupled with fresh slippages culminating in netlosses. Overall the Banking and Financial sector has been badly hit amidst thechallenging macro-economic environment.

The Government of India has notified a total of 196 systemically important NBFCs(including IFL) as ‘secured lenders' under the Securitisation and Reconstruction ofFinancial Assets and Enforcement of Security Interest Act 2002 (SARFAESI). Therefore theCompany can now enforce the security interest on assets charged to it without having toresort to either judicial or arbitral proceedings. The Company is now focussing uponstandard factoring deals with quality debtors and has done away with risker variants.

At the same time the Company is also targeting MSME customers having acceptable riskprofile. In view of Insolvency and Bankruptcy Code 2016 being enacted the Companyforesees strengthening of recovery mechanism and reduction in NPAs. As on date IFCI Ltdholds 99.89% shareholding in the IFL making it a subsidiary Company of IFCI.


MPCoN Ltd is a professionally managed Technical Consultancy Organization promoted byyour Company established in 1979. It is a premier consulting organization having base inCentral India providing quality consulting services. The Company consolidated its projectconsultancy business and also enhanced its presence in the training and capacity buildingspheres. It has bagged skilling projects in 13 states of the country including MadhyaPradesh and Chhattisgarh from various Central Government undertaking and the Ministry ofRural Development Government of India.

It is working with National Safai Karamcharis Finance & Development Corporation (AGovernment of India Undertaking under the Ministry of Social Justice and Empowerment)National Handicapped Finance and Development Corporation (Department of Empowerment ofPersons with Disabilities Ministry of Social Justice and Empowerment Government ofIndia) Department of Science & Technology Ministry of Science and TechnologyGovernment of India etc. for Skilling Division. Apart from Training and SkillDevelopment the financial inclusion project has been expanded further to cover more areasin Madhya Pradesh. MPCON has also proved its worth in the other spheres of consultancyservices such as Document Management System Solid & Liquid Waste Management SolarEnergy Impact Assessment Studies etc. As on date IFCI holds 79.72% shareholding inMPCON making it a subsidiary Company of IFCI.


Tourism Finance corporation of India Ltd (TFQ)

Tourism Finance Corporation of India Ltd (TFCI) a Public Financial Institution wasincorporated in 1989 pursuant to the recommendations of the National Committee on Tourismset up under the aegis of the Planning Commission Government of India. Your Company alongwith other All-India Financial/Investment Institutions and Nationalised Banks promotedTFCI to cater to the financial needs of burgeoning tourism industry.

Since its inception TFCI has provided high-quality research and consultancy servicesto the tourism industry in general and to the investors in tourism industry in particular.It provides financial assistance to enterprises for setting up and/or development ofhotels resorts amusement parks and tourism-related projects facilities and services. Itundertakes appraisal of individual projects project studies and surveys for variousState Government agencies/individual clients. As on date IFCI holds 26.09% shareholdingin TFCI making it an Associate Company of IFCI.

Himachal consultancy organisation Ltd (HIMcoN)

HIMCON was promoted in 1977 by your Company as the lead institution along with otherFIs such as IDBI ICICI Ltd in collaboration with Nationalised Banks and State LevelCorporations and Institutions. HIMCON is a multi-functional and multi- disciplinaryorganization offering a wide range of services to the industrial and infrastructuredevelopment and to a wider spectrum of clientele including those outside the state ofHimachal Pradesh.

The major thrust areas of HIMCON's service base include Evaluation Studies ProjectAppraisals Compilation of Project Reports Compilation of Pre-Feasibility /FeasibilityReports TEVs Services under SARFAESI Act 2002 Preparations of comprehensive developmentplans of the area act as Project Monitoring Consultants and Conducting EDPs & SkillDevelopment Training Programmes and Awareness Programmes. HIMCoN diversified itsactivities by undertaking new projects. These new projects include Construction of godownsfor Himachal Pradesh State Civil Supplies Corporation Ltd (HPSCSC Ltd) Supply of ITHardware etc.

As on March 31 2017 IFCI held 49% shareholding in HIMCoN making it an AssociateCompany of IFCI and the entire investment has since been divested.

North India Technical Consultancy Organisation Ltd (NITCON)

NITCoN setup in 1984 by your Company as the lead institution jointly with IDBIICICI State Level Corporations and Public Sector Commercial Banks to render costeffective professional consultancy services to units in small/medium/large-medium scaleindustries/Entrepreneurs/Institutions/Government and Government Agencies. NITCoN has beenan all-time associate of the SME movement. NITCoN has gained considerable expertise inundertaking detailed Techno-Economic Appraisals/TEFRs of investment proposals envisaginggreen field projects as also of expansion modernization diversification proposals.NITCoN also takes up TEVs of existing industrial units for revival/rehabilitationinvolving BIFR/CDR cases Energy Audits Advisory Assignments and preparation of inventoryand valuation of assets to help the institutions/banks in valuation of securities sale ofassets and one Time Settlement (oTS).

NITCoN has over 3 decades of experience in promoting selfemployment and wageemployment through Entrepreneurship Development Programmes (EDPs) as well as SkillDevelopment Programmes (SDPs) having trained over 1 lakh beneficiaries.

As on March 31 2017 IFCI held 48.75% shareholding in NITCoN making it an AssociateCompany of IFCI and the entire investment has since been divested.


KITCo witnessed a growth in all its verticals in the FY 2016-17. KITCo bagged handfulof assignments from leading public sector institutions such as Airports Authority of India(AAI) Air India NHAI HPCL BPCL Mumbai Port Maharashtra Maritime Board IndianMaritime Board etc. in the last Financial Year.

The year witnessed successful completion of CIAL's new international terminal. Theproject activities at Kannur International Airport Ltd (KIAL) and the MRo facility atNagpur for Air India are fast progressing and the excellent performance of the company inthe aviation sector enabled it to get empanelled as consultant to AERA (Airport EconomicRegulatory Authority). KITCo was also awarded with the Feasibility study for new airportsat Meerut and Faizabad for Airport Authority of India.

The company had been appointed as engineering and procurement management consultant byHPCL for refurbishment of the tank farm and pipe-lines at Butcher Island in Mumbai. KITCohas developed an innovative cost effective fully automated and safe system for fillinghandling stacking and truck loading of bitumen drums for BPCL. KITCo had bagged fewstudies leading to DPR from Ministry of Road Transport and Highways.

A "Study on Conservation/Development of Paddy/Wetland area in the Kochi CityRegion" was successfully completed in the last financial year which is one of thepioneer attempt in the country to assess the environmental significance of wetlands andpaddy fields in urban setting towards integration as a decision making tool in futuristicplanning of Kochi City.

In its commitment to partner with the MSME sector for its progress KITCo had initiatedMSME-Nurture Programme. The programme envisages selection of promising units andhandholding to success. KITCo's incubation activities through KITCo-TBI has startedbringing noticeable achievements.

As on date IFCI holds 20.26% shareholding in KITCo making it an Associates Company ofIFCI.

Joint Venture

IFCI sycamore capital Advisors Pvt. Ltd

The Company has 50% interest in IFCI Sycamore Capital Advisors Pvt Ltd (ISCAPL)incorporated in November 2011 which is under voluntary liquidation and official Liquidatorhas been appointed. The liquidator of ISCAPL repaid the amount of Rs.2.64 crores towardsFully Convertible Debentures in the year 2016-17. The Company has made adequate provisiontowards equity investment considering the probability and quantum of share in distributionupon liquidation of the Company. Therefore the same has not been considered for thepurpose of consolidation of financial statements.



Institute of Leadership Development (ILD)-erstwhile Institute of Labour Development wasestablished in 1992 by your Company. ILD is working towards its mission to buildcapacities hone up and infuse leadership skills among all levels of human resources inall types of organizations i.e. business and corporate entities Banks SMEs NGossocial action groups key developmental sectors like education health energy andenvironment and in the wide sweep of the government sector.

ILD is also engaged in imparting skill development programmes for the unemployed youthsof the state of Rajasthan and giving them job placements with the CSR fund support fromdifferent organizations. ILD is also an empanelled agency with Rajasthan Skill andLivelihoods Development Corporation (RSLDC) Jaipur to carry out skill developmentprogrammes in the areas of Textile technology Fashion technology Hospitality etc.

A Memorandum of Understanding (MoU) was signed amongst the Government of Rajasthan(GoR) IFCI Limited (IFCI) and the Institute of Leadership Development (ILD) fordeveloping ILD as a Centre of Eminence' for skill development with the ultimate aim ofdeveloping a Skills University. The Honourable Governor of Rajasthan had notified theestablishment of The Rajasthan ILD Skills University Jaipur. The Legislative Assembly ofthe Government of Rajasthan has passed the Bill related to the formation of Rajasthan ILDSkill University (RISU) in ILD campus in its budget session on March 07 2017 and"The Rajasthan ILD Skills University (RISU) Jaipur Act 2017" Act No.6 of 2017has been enacted. Accordingly ILD has taken steps for the setting of the SkillsUniversity in ILD campus the first Skill University in the Public Sector.


MDI Gurugram one of the leading Business Schools in India is consistently ranked amongthe top B Schools of the country by reputed agencies and publications. MDI has thedistinction of being the first internationally accredited Indian Business School havingreceived international accreditation by Association of MBAs (AMBA) London in 2006. MDI isa flourishing cauldron of excellence in management education high quality researchexecutive development and value added consultancy.

Having established its footprint worldwide MDI's vision is to become one of the topbusiness schools in the world by incorporating world's best academic practices in all itsprogrammes namely management and executive programmes and training programs for the topmanagement of the corporate world. MDI's offerings are continuously updated in keepingwith the ever changing global business environment social responsibilities while settinghigh standards for all our stakeholders.


Rashtriya Gramin Vikas Nidhi (RGVN) having its headquarters in Guwahati Assam wasestablished in 1990 as an autonomous non-profit organization registered under theSociety's Registration Act 1860. Your Company being the founding promoter of RGVNprovided the initial set-up support and with time IDBI National Bank for Agriculture andRural Development (NABARD) and Tata Social Welfare Trust (TSWT) also became its promoters.RGVN is a national level multi-state development and support organization working in thestates of Assam Arunachal Pradesh Meghalaya Mizoram Nagaland Manipur TripuraSikkim odisha Jharkhand and Bihar poverty stricken pockets of Eastern Uttar Pradeshcoastal Andhra Pradesh and Chhattisgarh. RGVN's core strength comes from its network ofNGos and Self Help Groups which are capable of handling large development projects.

One of its programmes has been hived-off into an NBFC called RGVN (North East)Microfinance Ltd which has also been given small finance bank license by the RBI. over theyears RGVN has been able to groom and support small Community-based organizationsinvolved in a variety of livelihood enhancement programmes. of late RGVN has beeninvolved in implementing projects directly with funding support from Central & StateGovernments Corporate Houses under their CSR Programmes as well as national andinternational development organizations in verticals such as Food Security &Livelihood Enhancement Financial Literacy and Inclusion Enhancement of Quality of Lifein Rural Areas and Analytical & Studies.


Consequent upon transfer of IFCI's entire stake in HARDICoN Ltd (HARDICoN) it hasceased to be an Associate Company of IFCI. Further subsequent to the year under reportHIMCoN and NITCoN have also ceased to be Associate companies of IFCI consequent totransfer of IFCI's entire stake in these companies.

Details on performance and financial position of subsidiaries associates and jointventure(s) during FY 2016-17 are provided in Annexure-VII.


During the Financial Year 2016-17 all returns/data/statements submitted by concerneddepartments as advised by RBI SEBI and other Regulatory Authorities have been submitted.


Pursuant to the provisions of the Companies Act 2013 Listing Regulations the Companyis required to place various Policies/Documents/Details on the Website of the Company. TheCompany has a website and all the requisite information are being uploadedthereat.


A detailed report on Corporate Governance as stipulated under Listing Regulations isattached to the Annual Report. Certificate from Practicing Company Secretary regardingcompliance with the conditions of Corporate Governance as stipulated in ListingRegulations and under Guidelines on Corporate Governance for Central Public SectorEnterprises 2010 has been obtained and is annexed at the end of Corporate GovernanceReport.


Conservation of Energy-The Company's operations do not involve any manufacturing orprocessing activities. It provides financial assistance to the industries therebyrequires normal consumption of electricity. Accordingly the provisions of Section 134 (3)(m) of the Companies Act 2013 read with Rule 8 (3) of Companies (Accounts) Rules 2014are not applicable on the Company.

Technology Absorption-In constant endeavour to drive competitive advantage throughoperational Excellence your Company is taking proactive steps towards Business Continuityplanning. With regard to the same the Data Centre and Disaster Recovery site has beenupgraded as well as a near site has been established.

Information Technology (IT) of your Company enables sophisticated product developmentbetter market infrastructure implementation of reliable techniques for control of risksand helps the intermediaries to reach geographical distant and diversified markets.

While Enterprise portals promise to deliver a more coherent information managementplatform and a more seamless user experience various online portals namely-OnlineGrievance Recruitment and IT Applications were launched by your Company. These portalsprovide ‘dynamic' environment that makes them well-suited to delivering moreinteractive capabilities.

Foreign Exchange Earnings

The details in respect of foreign expenditure /earnings are as follows:

(Rs. crore)
Particulars Year ended 31.03.2017 Year ended 31.03.2016
Expenditure in Foreign Currencies:
Interest on borrowings 3.69 3.82
Other matters 0.21 0.23
TOTAL 3.90 4.05
Earnings in Foreign Currencies:
Earnings in Foreign Currency Nil Nil


There were no qualifications or reservations or adverse remarks made by the StatutoryAuditors for the standalone financial statements or consolidated financial statements.However the auditors have made following observations:

Emphasis of Matter on Standalone financial statements:

We draw attention to note no. 27 of the standalone financial statements related tolitigation with the borrower. Pending adjudication of the matter by the Honourable SupremeCourt in the opinion of the management no provision or adjustment is required in thebooks of accounts. Our report is not modified in respect of this matter. Emphasis ofMatter on Consolidated financial statements:

(a) The holding company holds investment in seven companies to the extent of 20% ormore of their respective total share capital and accordingly these companies are theassociates of the holding company as per the Companies Act 2013. For the reasons statedin the note no. 26.1 of the financial statement these associates have not beenconsolidated in the preparation of the consolidated financial statements of the Group. Ourreport is not modified on the matter.

(b) We draw attention to note nos. 35 and 36 of the consolidated financial statementsrelated to litigation with the borrowers of the holding company and subsidiary companyrespectively. Pending adjudication of the matter by the Honourable Supreme Court in theopinion of the management no provision or adjustment is required in the books of accountsof the holding and subsidiary company. our report is not modified in respect of thismatter.


M/s Navneet K. Arora & Co LLP Company Secretaries was appointed as SecretarialAuditor of the Company for the Financial Year 2016-17. The Secretarial Auditor hasreported that the Company has in their opinion complied with the provisions of theCompanies Act 2013 and the Rules made thereunder as notified by Ministry of CorporateAffairs and related matters. The Secretarial Auditor also reported that during the periodunder review the Company has complied with the provisions of the Reserve Bank of IndiaAct read with applicable Non-Banking Financial Companies (Reserve Bank) Directions asapplicable except delay in filing of e-returns in Form No(s) NBS-7 for the quarter ended30th June 2016 and 31st December 2016.

In this regard it is stated that the e-return NBS-7 was filed only after Boardapproval of final accounts for the period. The Reserve Bank of India was informed of thesame who had not objected to the request of the company considering the facts. It wasalso explained to the Secretarial Auditor that the company being a listed entity theresults which was part of NBS-7 Return could not be disclosed prior to the same wasprovided to Stock Exchanges where the shares of the company were listed.

The Secretarial Audit Report for FY 2016-17 in the Form MR-3 is annexed at Annexure-VIII.


Pursuant to the provisions of the Companies Act 2013 your Company has obtainedDeclaration of Independence from the Independent Director under Section 149 of theCompanies Act 2013.


Your Company has in place an Internal Financial Control driven by the policies andprocedures adopted by the company for ensuring the orderly and efficient conduct of itsbusiness including adherence to company's policies the safeguarding of its assets theprevention and detection of frauds and errors the accuracy and completeness of theaccounting records and the timely preparation of reliable financial information. TheInternal Financial Control was evaluated by the Audit Committee of Directors during theyear under report.


Pursuant to the requirement under Section 134 of the Companies Act 2013 with respectto Directors' Responsibility Statement it is hereby confirmed:

(i) That in the preparation of the annual accounts the applicable accounting standardshad been followed along with proper explanation relating to material departures;

(ii) That the directors had selected such accounting policies and applied themconsistently and made judgments and estimates that are reasonable and prudent so as togive a true and fair view of the state of affairs of the company at the end of thefinancial year and of the profit and loss of the company for that period;

(iii) That the directors had taken proper and sufficient care for the maintenance ofadequate accounting records in accordance with the provisions of this Act for safeguardingthe assets of the company and for preventing and detecting fraud and other irregularities;

(iv) That the directors had prepared the annual accounts on a ‘going concernbasis';

(v) That the directors have laid down internal financial controls to be followed by thecompany and that such internal financial controls are adequate and were operatingeffectively; and

(vi) The directors had devised proper systems to ensure compliance with the provisionsof all applicable laws and that such systems were adequate and operating effectively.


M/s ASA & Associates LLP (DE1187) (Firm Reg. No. 009571N) and M/s KPMR &Associates (DE0637) (Firm Reg. No. 02504N) were appointed by the Comptroller & AuditorGeneral of India (C&AG) as Joint Statutory Auditors of your Company for FY 2016-17.C&AG shall appoint Statutory Auditors for the Financial Year 2017-18.


(A) Credit Departments

During the year under report the Credit Department functioned under two divisionsCredit-I and Credit-II based on the geographical distribution and the NPA Resolution& Litigation Group managed the NPAs. This has been later reorganised by setting upAppraisal Department and Monitoring Department in order to strengthen the appraisal andpost sanction monitoring respectively. In view of the emphasis on infrastructuredevelopment in the country and the contribution of your Company in this direction thereis a specialised Infrastructure Division in the Appraisal Department while the non-infrasectors are considered by another division. These departments are actively engaged informulation of Policy refinement of processes and improvement in practices of creditappraisal and are effectively and efficiently monitoring the standard assets of IFCI.

(B) Management of Non-Performing Assets (NPA Management)

The FY 2016-17 witnessed large increase in NPAs in the financial sector especially ininfrastructure and metal sectors. This along with unsuccessful attempts for implementationof SDR & S4A schemes of RBI in certain companies resulted in substantial rise in NPAsin your Company. The Gross NPAs and Net NPAs increased to Rs.7553 crore and Rs.5882crore respectively by March 31 2017 from Rs.3545 crore and Rs.2466 crore respectivelyat the beginning of the year. In the percentage terms the GNPA and NNPA stood at 31.86%and 27.03% respectively at the end of the year. This has necessitated focussedexpeditious recovery from NPAs.

Your Company amplified its endeavours for recovery of overdues by leaps and bounds andoverturned every stone to ensure early detection and resolution of non-performing cases.In this sequel your Company vigorously exploited all the available recovery modesincluding One Time Settlement/Negotiated Settlement restructuring sale of assets underSARFAESI assignment of dues sale of listed/unlisted pledged shares sale of investmentin unlisted equity redemption of Security Receipts filing winding up applicationsagainst defaulting borrowers filing of recovery applications before DRTs action u/s 138of Negotiable Instruments Act declaration of defaulting borrowers as wilful defaultersnon-cooperative borrower etc.

The concentrated efforts made during FY 2016-17 resulted in highest ever recovery ofRs.1016.38 crore done by IFCI in last 10 years as tabulated below:-

(Rs. crore)
Sl. No. Resolution Strategy Amount
1. Assignment of debt 417.88
2. OTS/Legal route/sale of pledged shares/general recovery 394.63
3. Sale of unquoted equity/redemption of SRs 203.87
Total 1016.38

The Insolvency and Bankruptcy Code introduced in December 2016 has provided for acomprehensive framework of timely restructuring of liabilities of companies orliquidation. Your Company is fully committed to make an effective and efficient use ofthis code for augmenting its recoveries in the ensuing year. Your Company apart fromcontinuing to recover through the existing means like SARFAESI oTS Legal route etc.shall take advantage of this code and strive to achieve the objects of the code byresolution of its impaired assets under the provision of the code.

(C) Sugar Development Fund

Your Company has been acting as the "Nodal Agency" of the Government of Indiasince inception of the Sugar Development Fund (SDF) for the purpose of disbursementfollow up and recovery of SDF loans sanctioned for modernisation/expansion of sugarfactories setting up of bagasse based cogeneration power projects anhydrous alcohol orethanol projects zero-liquid discharge (ZLD) distillery projects and cane developmentscheme. Cumulative sanctions and disbursements under SDF up to March 31 2017 stood atRs.6436 crore and Rs.5028 crore respectively. The Agency Commission booked in FY 2016-17is Rs.13.95 crore (excluding Service Tax). In addition your Company carries out financialappraisal of projects for availing SDF loans by sugar mills. Your Company has developed aSDF Portal for being utilised by SDF Government of India and the beneficiary companiesand is in the process of making the portal fully functional which will make SDF operationsefficient and transparent.

(D) Credit Enhancement Guarantee Scheme for Scheduled Castes

The Department of Social Justice & Empowerment under the aegis of Ministry ofSocial Justice & Empowerment Government of India has sponsored the "CreditEnhancement Guarantee Scheme for Scheduled Castes" under its social sectorinitiatives. The objective of the Scheme is to promote entrepreneurship amongst theScheduled Castes by providing Credit Enhancement Guarantee to Member Lending Institutions(MLIs) who shall be providing financial assistance to these entrepreneurs. The Governmentof India has initially allocated a corpus of Rs.200 crore for the Scheme out of which theguarantee cover shall be extended to the Member Lending Institutions. IFCI Ltd has beendesignated as the Nodal Agency under the Scheme to issue the guarantee cover in favour ofMember Lending Institutions who shall be encouraged to finance Scheduled Casteentrepreneurs to boost entrepreneurship amongst the marginal strata of the Society.

The Scheme has since taken off from the FY 2015-16 with registration of 31 MLIs underit. In the FY 2016-17 loans aggregating to Rs.21.27 crore have been sanctioned by some ofthe MLIs against which the total guarantee cover of Rs.14.40 crore has been provided byIFCI. Your Company is making all out efforts to promote this Scheme through wide publicityby conducting seminars conferences and awareness programmes in co-ordination with variousChapters of Dalit Indian Chambers of Commerce and Industry (DICCI) and attending StateLevel Bankers Committee (SLBC) meetings. During the FY 2016-17 the Corpus of the fund hasincreased to Rs.232 crore.

IFCI has launched a web portal of the above mentioned scheme ( on 14thFebruary 2017 and the link is also available on our website i.e. promotion of the CEGSSC scheme is being made through social media like FacebookTwitter etc.

(E) Human Resources

Your Company has continued to lay focus on enhancement in productivity of employees andtheir skill upgradation. Training was imparted to employees through 250 nominations byway of in-house training workshops and external nominations thereby covering 140employees and 4 employees were sent on foreign trainings. The manpower has beenstrengthened by conducting recruitment at various levels viz. General Manager DeputyGeneral Manager Assistant General Manager Manager and Assistant Manager. The scheme ofSpecial Hardship Leave was introduced for female employees. The level of satisfactionamong employees has improved which resulted into lower attrition rate as compared toprevious year.

(F) Information Technology

Information Technology (IT) enables sophisticated product development better marketinfrastructure implementation of reliable techniques for control of risks and helps theintermediaries to reach geographical distant and diversified markets. In that directionyour Company has achieved many noteworthy developments related to IT sector during FY2016-17. IT has emerged as an important medium for delivery of financial products andservices.

While Enterprise portals promise to deliver a more coherent information managementplatform and a more seamless user experience various online portals namely-onlineGrievance Recruitment and IT Applications were launched by your Company. These portalsprovide dynamic environment that makes them well-suited to delivering more interactivecapabilities.

Further your Company also launched Credit Enhancement Guarantee Scheme for ScheduledCastes an initiative of Ministry of Social Justice and Empowerment. MPLS-VPN connectivitywas also established across all Regional offices which was followed by implementation ofBio-Metric Attendance System. At present your Company is in the process of implementingIntegrated Treasury product as well development of another online Portal for SugarDevelopment Fund for transparent flow of operations and information.

(G) Legal

on the legal front your Company has a full-fledged qualified and experienced legalteam who carry out the legal functions for facilitation of sanctions and disbursements andhas ensured compliance with statutory requirements during the year. Further your Companyinitiated prompt legal measures for recovery against the borrowers and was able to defendsuccessfully before various judicial forums in India in the suits filed against it duringthe year 2016-17.

(H) Right to Information

Your Company has implemented the Right to Information Act 2005 from 2013 onwardsfollowing the applicability of the RTI Act to IFCI and it has been providing informationto the applicants as per the provisions of the RTI Act. The relevant information as perthe RTI Act has been posted on IFCI's website (

IFCI has appointed Central Public Information officer (CPIo) & First AppellateAuthority at its Head office at New Delhi and Central Assistant Public Informationofficers (CAPIo) at its Regional offices in other parts of the country for providinginformation to the applicants under the RTI Act.

During the year your Company received 142 applications and 16 appeals seekinginformation under RTI Act which were replied to as per the provisions of the RTI Actwithin the stipulated time.

(I) Promotion of Rajbhasha

During the year your Company continued its efforts to promote the use of Hindi in itsofficial work. With a view to motivate and encourage the officers to use Hindi in officialwork Hindi workshops and competitions were organized at Head office as well as at otheroffices across the country. IFCI's officers bagged prizes in various Hindi Competitionsorganized by Town official Language Implementation Committee.

The official Language Committee at Corporate office monitored the use of Hindi in alloffices and provided necessary guidance. All the computers available have been upgradedwith Unicode facility and the website of your Company has also been made bilingual for thebenefit of the shareholders and other stakeholders.

(J) Nominee Directors

Your Company appoints Nominee Directors on the Boards of some of the assisted concernsor stipulates condition for appointment of Nominee Director under certain conditions asper the Board approved Policy wherever it is considered necessary to do so which is inline with the established practice of Institutions and Banks to monitor the performance ofthe companies where they have provided financial assistance. The underlying objective ofmaking such appointment is to help build professional management and facilitate effectivefunctioning of the Board as well as formulation of proper corporate policies andstrategies to improve productive efficiency and promote long term growth of the assistedcompanies keeping in view the overall interest of the shareholders and financialinstitutions. The feedback received from Nominee Directors act as a tool for creditmonitoring.


1. Business Environment and Economic Scenario

1.1 Macro economic Scenario & developments

The year 2016-17 witnessed some major surprises globally which included Brexit resultsof the US elections and Demonetization in the largest democracy of the world. Though theIndian economy showed signs of improved industrial climatic conditions in the coming yearson the back of some major reform initiatives like Goods & Services Tax (GST) thegrowth in India's GAP declined to 7.1% year- on-year in FY 2017 from 8.0% in the previousyear. The global economic growth also slowed down to 3.1% during calendar year 2016 withboth the advanced and emerging economies contributing to the decline.

The fiscal year 2017 also saw some major policy initiatives apart from GST andDemonetization. These included enactment of the Insolvency and Bankruptcy Code 2016 forspeedier resolution or liquidation of stressed assets merger of Railway Budget with theUnion Budget removal of expenditure categorisation into plan and non-plan constitutionof six member Monetary Policy Committee with responsibility of monetary policy decisionmaking and liberalisation of foreign investment policies.

During the year the consumer price inflation (CPI) reached a three year low of 3.8% inMarch 2017 as against 4.8% in March 2016 but the core consumer inflation remained sticky.During the same period the Wholesale Price Index (WPI) under the revised base year2011-12 increased from 4.7% in March 2016 to 4.9% in March 2017.

1.2 Banking Sector

Scheduled Commercial Banks' (SCBs') credit growth declined on y-o-y basis whereasdeposit growth increased between September 2016 and March 2017. SCBs' capital torisk-weighted assets ratio (CRAR) improved from 13.4% to 13.6% between September 2016 andMarch 2017. However the Tier-I leverage ratio at the system level declined marginallyduring the same period.

SCBs' annual profit after tax (PAT) expanded by 48.0% in 2016-17 as against a declineof 61.6% in 2015-16 mainly due to higher increase in other operating income (OOI) andlower risk provisions. The share of ooI in total operating income increased sharply from30.7% in 2015-16 to 36.2% in 2016-17 mostly contributed by profit on securities trading.However public sector banks (PSBs) once again recorded negative returns on their assets.Continuing deceleration in the growth of assets of SCBs along with deterioration in theirasset quality resulted in a secular decline in the share of net interest income (NII) intotal operating income. Though India's financial system remained relatively stable duringthe FY 2016-17 the business growth of SCBs remained subdued with PSBs continuing to lagbehind their private sector peers. The stress on banking sector particularly the PSBsremained significant. The banking stability indicator (BSI) shows that the risks to thebanking sector remained elevated due to continuous deterioration in asset quality lowprofitability and liquidity. The gross non-performing advances (GNPA) ratio of SCBsincreased to 9.2% from 7.8% during the period between March and September 2016 pushingthe overall stressed advances ratio to 12.3% from 11.5% in the same period. Large lendersregistered significant deterioration in their asset quality.

In the second half of the year GNPA ratio of SCBs further rose to 9.6% in March 2017.The net non-performing advances (NNPA) ratio of SCBs increased marginally from

5.4% in September 2016 to 5.5% in March 2017. The stressed advances ratio declined from12.3% to 12.0%. While there was a fall in stressed advances ratio in agriculture servicesand retail sectors the stressed advances ratio in industry sector however rose from22.3% to 23.0% mainly on account of subsectors such as cement vehicle mining &quarrying and basic metals. Accretion of new NPAs from restructured standard advancesdeclined in 2016-17.

1.3 NBFc Sector

As per the Financial Stability Report by The Reserve Bank of India as of March 2017there were 11517 nonbanking financial companies (NBFCs) registered with the Reserve Bankof India of which 179 were deposit accepting (NBFCs-D). There were 220 SystemicallyImportant NonDeposit accepting NBFCs (NBFCs-ND-SI). All NBFC-D and NBFCs-ND-SI aresubjected to prudential regulations such as capital adequacy requirements and provisioningnorms along with reporting requirements.

The aggregate balance sheet size of the NBFC sector expanded by 14.5% during 2016-17 ascompared to 15.5% during 2015-16. Loans and advances increased by 16.4% and investmentsincreased by 11.9% in March 2017. In terms of borrowings commercial paper outstandingrose by 70.3% and debentures outstanding increased by 28.3% as on March 31 2017 whilebank borrowings declined by 3.7%. Net profit was down by 2.9% during 2016-17. Net profitas a percentage of total income also came down from 18.3% in 2015-16 to 14.0% in 2016-17.RoA and RoE also declined during the same period.

Gross NPAs of the NBFC sector as a percentage of total advances declined from 4.9% to4.4% between September 2016 and March 2017. Net NPAs also declined from 2.7% to 2.3%.

While the NBFCs catering only to corporate sector were badly affected due to increasein NPAs and slowdown in credit offtake NBFCs financing only retail loans or mix ofcorporate and retail loans showed growth in their performance.

1.4 Initiatives and developments at IFCI

Your Company took some major initiatives during the year under report with primaryobjective of growth in business cost cutting and employee empowerment and satisfaction.Organisational restructuring was one such major initiative. With a view to optimising thecost and maximum utilisation of existing resource pool your Company decided to merge theGuwahati office with Kolkata Regional office and to close seven small offices at PatnaBhubaneswar Lucknow Kochi Vijayawada Raipur and Bhopal. Though some of these officeswere newly opened in the past two to three years they could not achieve the businessgrowth potential as envisaged at the time of opening due to various factors. For focussedattention the geographical spread of your Company was segregated into four Zones-WestEast North & South having Zonal Offices at Mumbai Kolkata Delhi and Hyderabadrespectively. The remaining six regional offices would function under the administrativeand operational guidance of the respective zonal offices. The functions of CreditDepartments were restructured with focus on improvement in appraisal standard withseparate groups for infrastructure and non-infrastructure appraisal. Some lateralrecruitments were made by bringing professionals with requisite experience to strengthenoperational processes especially in appraisal monitoring risk management and internalaudit. The employees' grievances were quickly addressed in order to boost their morale andimprove productivity.

Information & Technology being the backbone of financial process and datainfrastructure major upgradations in business applications were carried out and variousnew applications like "Customer Relationship Management" "TransferPricing" "Whistle Blower Mechanism" "Payment Requests""CSR Accounting Package" "Employee Clearance Slip" "EmployeeAsset & Liability under Lokpal" "SEBI Insider Trading Regulation Submittedby Employee" were implemented during the year.

Apart from internal IT upgradation and automation your Company also launched thefollowing online portals during the year:

> Grievance Redressal Portal for stakeholders

> Recruitment Portal

> Credit Enhancement Guarantee Scheme for Scheduled Castes Portal

> IT Application Portal to streamline accessibility of various applications

Your Company has been a great supporter of digitisation drive. It ensured that theentire receipt and payment transactions were undertaken through digital modes likeRTGS/NEFT/NECS. There were only few exceptions where payments were received throughcheques like in the cases of Post Dated Cheques of borrower entities/guarantors/promotersand where payments were made by cheques/DDs the recipients not having provided requiredinformation for digital transfer. Your Company discourages and avoids cash transactions.

2. Strengths Weakness Opportunities & Challenges

With existence for seven decades passing through various challenges on the way yourCompany is a historical institution with major contributions to the industrialisation inthe country and in the course your Company has developed core competence in financinginfrastructure and core sector industries. Being the only sector-agnostic NBFC in thecorporate lending arena with geographical presence across the country through relativelysmall staff strength of about 260 mostly professionals your Company has the potential torise above the occasion through concerted and planned effort. Its weakness however liesin its large proportion of non-performing assets resulted primarily due to problems inpower and iron & steel sectors and in certain other large value borrower companies.

The major challenge your Company faces is in the form of borrowing cost which thoughreasonable is higher compared to banks and its peer NBFCs. The consequent down-gradationof credit rating due to stressed portfolio has aggravated the situation. Amongst theseconcerns the introduction of Insolvency and Bankruptcy Code has generated optimism inquick resolution/redressal of stressed assets. Your Company has set up a strong recoverymechanism for fast recovery from the NPAs through a dedicated team with expertise. Withthe steps taken by the government in major reforms like GST relaxation in FDI andprediction of good monsoon in the current year there is hope for capex and credit offtakepicking up in the second half of the year which would provide the required boost to thefinancial sector including your Company.

Apart from emphasis from recovery from NPAs your Company has also taken other majorsteps like reduction in single borrower and group exposure to below RBI prescribed levelsto avoid concentration risks reduction in its lending benchmark rate to improve portfolioquality.

3. Segment-wise or Product-wise Performance

During the FY 2016-17 your Company strived to perform despite facing challengingmacro-economic and industrial atmosphere. Your Company sanctioned project finance generalcorporate loans of various maturities to meet financing requirements of its clients withgood track records and credit worthiness refinancing of high cost debt and capitalexpenditure for ongoing projects against adequate tangible security. During the year yourCompany also launched a new product of Short Term Loans and sanctioned and disbursed shortterm loans of approximately Rs.605 crore and Rs.330 crore respectively which constituted7.64% and 10.81% of the aggregate sanctions and disbursements of Rs.7923 crore andRs.3053 crore respectively.

4. Outlook

4.1 Global Developments and outlook

After years of lacklustre growth the global economy seems headed for a turnaround ascan be seen in the improvements in industrial production and the purchasing managers'index (PMI) and financial conditions of advanced economies (AE) approaching a neutralcondition. Notwithstanding concerns over rising protectionism populism and emerginggeopolitical conflicts the world economic outlook for the Year 2017 looks brighter ascompared to the Year 2016. Several factors seem to be contributing to this positiveoutlook; the end of a big decline in resource sector investment spending moderation offiscal austerity in Europe with the Eurozone achieving faster growth than the US in 2016and inflation just under the European Central Banks' target of 2% stimulus in Chinamoderating US dollar strength prospects of an inflation uptick in Japan partial reversalof commodity prices and market expectations of a somewhat moderated monetary accommodationwithdrawal path in the US.

While there are uncertainties the underlying feeling of a stable transition from aglobal accommodative monetary policy regime to a normal rate cycle is evident in equityand fixed income markets. However unlike past business cycles wherein credit growthacceleration preceded an uptick in GDP growth growth in private credit to nonfinancialcorporations is muted. While global trade has picked up US dollar has recently weakenedvis-a-vis other global currencies. The divergence in ‘rate outlook' between the Fedand the other advanced economies (AEs) and soft commodity prices may impact AEcurrencies. Geopolitical risks are elevated and a real concern is the perceived weakeningof international institutional mechanisms to deal with them. At the same time one has toawait the on-going churning in political processes across the world to assess how much ofthe rhetoric on protectionism and populism will ultimately materialise.

4.2 Domestic Development and outlook

During the FY 2016-17 Indian economy though emerged as the fastest growing economy inthe world with 7.1% growth surpassing China's growth of 6.9% for the year 2016 howeverthis growth was lower than last year's growth of 8.0% (revised due to change in base yearfrom 2004-05 to 2011-12 for calculation of Index of Industrial Production) on account ofdip registered in the growth of Q4 of FY 2016-17 as the economy grew by 6.1% as comparedto growth registered in previous 3 quarters at 7.9% 7.5% and 7.0% respectively. Thegrowth was dragged to the minimum in last quarter of FY 2016-17 partially on account ofdemonetisation. As per RBI GVA growth for 2016-17 is pegged at 6.7% which is about 30bps lower than what was estimated earlier.

During the year the demonetisation drive was started with the aim to wipe out ameasure of corruption and tax evasion mainly in India's real estate market. Though it hasimpacted the growth in cash-intensive sectors such as real estate construction and FMCGfor a short term as consumers deferred purchases over the medium term there would bebenefits through higher government spending and greater tax compliance. Also it hasconverted the household savings from physical to financial instruments which has providedenough liquidity to the banks for lowering the lending rates much needed for the growth.

As per the latest figures released by CSo the growth rate of the industrial sectorshowed a declining trend over the last 5 years since adoption of base year 2011-12 withthe Index of Industrial Production reaching low of 2.70% in March 2017 from 6.50% in April2016 after touching high of 8.90% in June 2016.

The eight core infrastructure supportive industries viz. coal crude oil natural gasrefinery products fertilizers steel cement and electricity registered a cumulativegrowth of 4.5% during FY 2016-17 as compared to 4.0% during the previous year. Theproduction of steel and refinery products grew substantially during the FY 2016-17 whilethe production of crude oil cement and natural gas fell. Production of electricity coaland fertilizers registered decelerated growth during the same period.

The macro-economic parameters like inflation fiscal deficit and current accountdeficit exhibited distinct signs of improvement and stayed within the target. The monetaryconditions remained consistent with achieving the target of retail inflation under 5%. Thedepreciation in rupee against US dollar like most other currencies in the world had alesser impact on the growth of the country.

As per the recent World Economic outlook brought out by IMF the growth projections forIndian Economy have been trimmed down to 7.2% in CY 2017 from 7.6% primarily because ofthe temporary negative consumption shock induced by cash shortages and payment disruptionsfrom the recent demonetisation drive. Medium-term growth prospects are favourable withgrowth forecast to rise to about 8% over the medium-term due to the implementation of keyreforms like GST loosening of supply-side bottlenecks and appropriate fiscal and monetarypolicies.

As per the Economic Survey of 2016-17 keeping in view the prevalent overallmacroeconomic scenario and as per normal rainfall predictions in 2017-18 by IMD India'seconomic growth for the FY 2017-18 has been pegged in the range of 6.75%-7.5% in 2017-18.As per projections of ADB the Indian Economy is expected to grow at a quicker pace by7.4% in 2017-18 as compared to 7.1% in FY 2016-17 and maintain the fastest growing economytag on the back of various reforms initiated by the Government especially in the bankingsector.

5. Risks and Concerns

Risk is an inherent part of business of any financial institution including IFCIwhich makes it susceptible to credit risks that arise when a borrower is expecting futurecash flows to pay a current debt. Effective management of credit risk is a criticalcomponent of comprehensive risk management and necessary for long term success of afinancial institution and hence it is essential that credit risk management system shouldbe sensitive enough and responsive to credit risks emanating from its business operationsso as to maintain a sound and well- diversified credit portfolio. The goal of credit riskmanagement is to maximize a FI's risk-adjusted rate of return by maintaining credit riskexposure within acceptable parameters.

To address these risks your Company has put in place a comprehensive credit riskmanagement framework which is integrated with its business model. In pursuance of RBIguidelines necessary role centres have been created in the organisational structure tofacilitate discharge of risk management functions which include the Board of Directorsthe Risk Management Committee of Directors (RMCD) the Risk Management Committee ofExecutives (RMCE) and the Risk Management Department.

Risk Management Department carries out risk assessment of all new credit proposalsfinalizing internal credit rating annual rating migration analysis highlighting theportfolio quality and compliance with pre-disbursement terms and conditions of sanctionpertaining to disbursements of loans. Market and Liquidity risks are monitored by AssetLiability Committee of Executives (ALCO) through analysis of dynamic liquidity positionstructural liquidity gaps and interest rate sensitivity positions. Besides mechanism forstress testing of the credit portfolio is also being put in place.

The General Lending policy Credit Risk Management Policy Market Risk ManagementPolicy and operational Risk Management Policy of your Company are reviewed periodicallykeeping in view the changing economic and business environment. To manage the operationalrisks there are adequate internal controls and systems in place aided and assisted byinternal audit remote back-up of data disaster management policy and appropriateinsurance of insurable assets of your Company as well as of the assets mortgaged to yourCompany. In line with the industry best practices and to ensure proper credit evaluationsand monitoring standards your Company carries out credit audit of standard exposures atregular interval. The main objectives of the audit exercise includes detection ofweaknesses in outstanding exposures initiation of timely corrective action compliancewith internal sanction and disbursement norms and follow-up and monitoring of cases whichserves as a tool for senior management to assess portfolio quality with constant endeavourfor asset quality improvement.

In future risk management is expected to play a more prominent role because of ongoingliberalisation deregulation and global integration of financial markets which would addnewer dimensions to risks faced by the Banks and NBFCs. Interrelationships andassociations amongst various risk categories and mushrooming of newer risks will requiremore proactive and efficient management of risks which will determine the strength andresilience of financial institutions.

Your Company would continue to work on various initiatives aimed at strengtheningcredit risk standards post sanction monitoring of the portfolio to migrate any adverseimpact on the loan portfolio of your Company. Your Company would also strive to develop astrong culture for risk management and awareness within the organisation.

6. Internal Control Systems and their adequacy

Your Company has Internal Control Systems commensurate with the size scale andcomplexity of its business and allied operations. The verification of effectiveness ofthese controls are made by the Internal Auditors through the process of "Risk basedInternal Audit". The internal audits are carried out by the Internal Audit Departmentthrough external practicing Chartered Accountant Firms and also directly through snapaudits. The periodicity of such audits varied from quarterly to yearly depending upon thesubstance and materiality of transactions after the scope was approved by the AuditCommittee of Directors. Based on the observations of Internal Auditors the process ownersundertake corrective actions in their respective areas and thereby strengthen the controlsystems.

In association with an external consultant of repute the framework of InternalFinancial Control was designed and implemented. The operative effectiveness of thecontrols were tested by the Internal Auditors and Statutory Auditors during the year andfound to be satisfactory. The areas of controls with gaps were identified and bridged ordecided for closure within finite period. The Board believes based on the above adequateinternal financial controls exist.

7. Discussion on Financial and Operational Performance

7.1 Financial Performance

After a period of ten years of consistency in profit generation your Company suffereda loss of Rs.458 crore during the year under report which was the compounding result ofdecline in operational income by 28.25% to Rs.2740 crore from Rs.3819 crore for theprevious year and increase in provisions against loans & investments to Rs.1192 crorefrom Rs.895 crore in FY 2016.

The major reason for fall in operational income was increase in fresh NPAs leading toreversal/non-recognition of interest income and low disbursement coupled with prepayments.The increase in provisions was primarily due to above reasons and reduction of defaultdays from 150 to 120 days for classification as NPAs. Failure of sum of the SDR and S4Acases for implementation in terms of RBI Guidelines also added to the NPAs reversal ofincome and provisioning.

The finance cost also reduced from Rs.2517 crore to Rs.2289 crore through reducedborrowings at lower cost and prepayments of certain high cost borrowing. Still the impactof large decline in interest income resulted in lower Net Interest Income of Rs.211 croreas against Rs.927 crore in previous year. Consequently the NIM also declined from 3.24%in FY 2016 to 0.80% in FY 2016-17.

The operating expenses excluding depreciation remained almost stagnant at Rs.138 crorebacked by reduction in employee benefit expenses from Rs.100 crore in previous year toRs.95 crore in FY 2016-17.

The provisions of Rs.1192 crore was primarily because of high provisions of Rs.922crore against loans the remaining Rs.270 crore being against the investments. In respectof investments your Company has been making required provisions in terms of RBIguidelines and relevant Accounting Standards. In addition your Company has also beenprudently making provisions on quarterly basis in respect of diminutions in investmentsshowing signs of stress though not other than temporary diminutions.

The income tax expense was negative due to deferred tax impact arisen primarily onaccount of high provisions.

Due to the impact of low credit offtake and prepayments of loans the balance sheetshrunk from Rs.36900 crore to Rs.31674 crore during the fiscal 2017. The Networth ofyour Company also declined to Rs.5683 crore from Rs.6129 crore a year back.

However the Capital Adequacy Ratio was maintained at 16.7% on March 31 2017 againstregulatory requirement of minimum 15% with the Tier I capital being 11.2% as againstregulatory norm of 10%. The debt to equity ratio was 4.03 improved from 4.54 at thebeginning of the year and the leverage ratio was 5.31 below the regulatory cap of 7times.

The cost of borrowings reduced from 9.4% for FY 2016 to 9.3% for FY 2017. Theproportion of employee cost however increased from 2.5% in the previous year to 3.3% inFY 2017 despite decline in absolute amount due to larger decline in income.

In view of the loss and in order to preserve capital and cash for future growth yourCompany skipped declaration of any dividend on equity shares after consistent dividendpayment for 8 years.

Your Company reduced its lending benchmark rate IFCI Benchmark Rate (IBR) from 11.70%at the beginning of the year to 10.75% by March 2017. The Short Term IBR introduced inApril 30 2016 at 9.40% was also reduced to 8.35% by the end of FY 2017.

7.2 Sanction and Disbursements

During the year under consideration your Company made sanctions and disbursements forvarious proposals aggregating to Rs.7923 crore and Rs.3053 crore lower than Rs.10895crore and Rs.7488 crore respectively in the previous year on account of subdued creditdemand and uneven economic growth and dip in manufacturing activity.

7.3 Treasury Investment and forex operations

In FY 2016-17 global landscape witnessed key developments like Brexit and presidentialelections in United States resulting in volatile markets. International financial marketshave been impacted by policy announcements in major advanced economies geo-politicalevents and country-specific factors. on domestic front too major policy initiatives wereseen like introduction of Insolvency and Bankruptcy Code demonetization which has boosteddigital payments and led to sharp increase in financial savings NPA ordinance andenactment of GST legislation. In India both domestic factors and global spill-overs haveconditioned movements in financial markets though increasingly domestic factors appear tohave played a more prominent role. Domestic equity markets had a mixed performancereflecting domestic factors amidst a cautious return of investor appetite and capitalflows.

In RBI's first bi-annual monetary policy the policy rate was kept unchanged with aneutral stance considering the fact that inflation could undershoot RBI's target of 5% forFY 2016-17. Excess liquidity resulting post demonetization was drained by RBI through thelarge quantum of variable rate reverse repos which softened the short term money marketrates to an extent. In the above backdrop your Company has been cautious in investing thesurplus funds with focus on safety while making every effort for efficient management ofliquidity and return.

In rupee operation the objective was to manage the surplus fund effectively withminimum risk and deploying it to get optimum return with availability of funds forbusiness requirement. The underlying investment principle is safety liquidity and riskcontainment and your Company invested in Treasury Bills Government SecuritiesCertificate of Deposit Commercial Papers Inter-Corporate Deposit/Short Term Deposit(STD) and Mutual Fund Schemes. Average Deployment during the year was Rs.1393.31 croreagainst Rs.940.86 crore in FY 2015-16 and annualised return on fund deployed was 7.82%.Your Company had consistently generated return higher than the average 91 day T-bill yieldduring FY 2016-17 from Treasury operations. During the year under report your Companyregistered an income of Rs.112 crore from Fixed Income Money Market operations as againstRs.135 crore during the previous year. The lower income was on account of plannedreduction of average surplus funds available with Treasury vis-a-vis last year to minimizenegative carrying cost as well as lower yields on money market instruments postdemonetization led by RBI action to drain excess liquidity from Banks.

During the year your Company continued with the strategy of selective disinvestment ofslow moving/illiquid stocks and strengthening the portfolio through investment in bluechip stocks. Net investment portfolio of your Company as on March 31 2017 stood atRs.6394 crore as against Rs.8188 crore as on March 31 2016.

The foreign currency operations were confined to servicing of FC liabilities andcontaining the exchange risk arising due to mismatch in the outstanding amount of FCassets and liabilities. The mismatches were covered through forward contracts currencyfuture and principal only swap. The net mismatch position was restricted to much below thelimit of USD 3 million approved by RBI by maintaining almost square position.

7.4 Resource Mobilization

Keeping in line with the sanctions and disbursements during the year under report anamount of Rs.5397 crore was mobilized comprising of Term loans of Rs.2750 crore NCDissue through Private Placement Rs.5 75 crore and Commercial Papers of Rs.2072 crore atthe competitive rates. The focus of your Company has been to arrange funds at the lowestpossible cost. Consistent efforts are being made by your Company to explore new avenues offund raising. The total borrowings of your Company were Rs.22899 crore as on March 312017 comprising of Rupee borrowing of Rs.22470 crore and foreign currency loan of Rs.429crore. The broad instrument wise break-up of rupee borrowing outstanding as at March 312017 is as indicated below.

Investor service has been the top priority for your Company with responsive handlingand timely processing of investor grievances received in physical or electronic formcontinued to be of extreme importance.

8. Material Development in Human Resources Industrial Relations Front includingnumber of people employed

Your Company has continued to lay focus on enhancement in productivity of employees andtheir skill upgradation. Training was imparted to employees through 250 nominations byway of in-house training workshops and external nominations thereby covering 140employees and 4 employees were sent on foreign trainings. Various allowances have beenlinked with the RBI. The manpower has been strengthen by conducting recruitment at variouslevels viz. General Manager Deputy General Manager Assistant General Manager Managerand Assistant Manager. The scheme of Special Hardship Leave was introduced for femaleemployees. The level of satisfaction among employees has improved which resulted intolower attrition rate as compared to previous year. As on March 31 2017 the number ofpeople employed was 262.

9. Environmental Protection and conservation Technological conservation renewableenergy developments foreign Exchange conservation

During the year under report your Company made constant endeavour for technologicalabsorption. With regard to the same the Data Centre and Disaster Recovery site have beenupgraded as well as a near site has been established. Your Company has also adoptedindustry standard Network security policies and standards. IFCI has also made sincereefforts for conservation of foreign exchange. During the year under report the amount offoreign exchange outgo was only to the tune of Rs.3.90 crore on account of interestpayment and incurring other expenses. Your Company had also put in sincere efforts toprotect and conserve the environment. Through its CSR initiatives IFCI made contributionto Patiala Foundation for construction of sewer treatment plant for irrigation anddevelopment of horticulture etc. Besides IFCI has financial products like term loanCorporate Loan Short term Loan etc. for financing of renewable energy projects which aresustainable and environmentally benign.

10. Corporate social responsibility

The Corporate Social Responsibility Committee of Directors formulates the CSR Policyand recommends to the Board of Directors on activities to be undertaken by the Company asspecified in Schedule VII of Companies Act 2013 and Companies (CSR Policy) Rules 2014.The CSR Committee recommended the amount to be incurred on the activities and earmarkedfunds for the envisaged priority areas as per vision of the Company for a particularfinancial year. To associate with the CSR Activities of IFCI and its Subsidiaries andAssociates a Trust by the name of "IFCI Social Foundation" has also beenestablished.

The investment in CSR activities is project based and for every project time frame andperiodic milestones are set at the outset. Some of the CSR Activities undertaken includescontribution to expression children homes organization for acquisition of mobile classroomvan; contribution to Institute of Leadership Development for conducting employmentoriented skill training programme for 400 unemployed youth of Rajasthan; contribution toArogya Sandhan Charitable Trust for construction of residential home for mentallychallenged person etc.

Cautionary Statement

Certain statements in Management Discussion and Analysis describing the Company'sobjectives estimates and expectations may be ‘forward looking' within the meaning ofapplicable laws and regulations. Actual results might differ materially from thoseexpressed or implied.

Comments of comptroller & Auditor General of india

The comments of Comptroller & Auditor General of India (C&AG) are at Addendum.


Your Directors wish to express gratitude for the cooperation guidance and support fromthe Ministry of Finance various other Ministries and Departments of the Government ofIndia The Reserve Bank of India The Securities and Exchange Board of India StockExchanges and other regulatory bodies The Comptroller & Auditor General of India andState Governments. Your Directors also acknowledge the valuable assistance and continuedcooperation received from all banks financial institutions overseas correspondent banksother members of the banking fraternity and investors. Your Directors would also like toexpress their appreciation for the efforts and dedicated service put in by the employeesat all levels of your Company.

Sanjeev Kaushik Ms Kiran sahdev
Deputy Managing Director Non-Executive Director
DIN: 02842527 DIN: 06718968
Address: IFCI Tower Address: IFCI Tower
61 Nehru Place 61 Nehru Place
New Delhi-110 019 New Delhi-110 019
Date : June 29 2017