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IFCI corrects on profit booking

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Capital Market Mumbai
Last Updated : Apr 22 2013 | 2:44 PM IST

Meanwhile, the BSE Sensex was up 41.66 points, or 0.21%, to 19,784.18.

On BSE, 21.05 lakh shares were traded in the counter as against an average daily volume of 28.88 lakh shares in the past one quarter.

The stock hit a high of Rs 39.50 and a low of Rs 38.50 so far during the day. The stock had hit a 52-week high of Rs 49.40 on 21 February 2012. The stock had hit a 52-week low of Rs 22.60 on 9 January 2012.

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The stock had outperformed the market over the past one month till 8 January 2013, rising 13.64% compared with the Sensex's 1.64% rise. The scrip had also outperformed the market in past one quarter, gaining 26.29% as against Sensex's 5.52% rise.

The mid-cap company has an equity capital of Rs 1660.84 crore. Face value per share is Rs 10.

Recent rally in the IFCI stock was triggered by media report that the government is restructuring the board of the company. According to the report, the government has asked the entire board of the IFCI to resign. The government, now the promoter, is reconstituting the board as part of a takeover process after becoming the largest shareholder with 55.57% stake, report added. The government last month converted optionally convertible debentures into equity at a price of Rs 10 per share.

Report suggested that reconstitution of board following change in promoters is part of good corporate governance. The reconstitution of the board will open doors for a possible merger with a financial institution or grant of a banking licence to IFCI, the report added.

Meanwhile, IFCI announced during trading hours on Tuesday, 8 January 2013, that Chandan Bhattacharya resigned from the board of the company. IFCI had during trading hours on Monday, 7 January 2013, that Rakesh Bharti Mittal resigned from the board of the company.

Earlier, IFCI during trading hours on Friday, 4 January 2013, said that Government of India nominated Anurag Jain, Joint Secretary, Ministry of Finance, Department of Financial Services on the company's board, in place of Sanjeev Kumar Jindal, Director and V. K. Chopra, Deputy Secretary. Further, Shobhit Mahajan, Atul Ashok Galande and S. Shabbeer Pasha has resigned from the board of the company, IFCI statement said.

IFCI's net profit fell 33.9% to Rs 131.01 crore on 8.8% decline in operating income to Rs 703.42 crore in Q2 September 2012 over Q2 September 2011.

IFCI offers a wide range of products to the target customer segments to satisfy specific financial needs. The company also provides corporate advisory services. IFCI is also the nodal agency for monitoring of Sugar Development Fund (SDF) loans for projects related to modernization and expansion, co-generation of power and production of alcohol/ethanol in the private sector. As a nodal agency, IFCI undertakes loan documentation, creation of security, recommendations to Government of India (GoI) for disbursement of funds, monitoring the progress of projects during implementation and operations, recovery of SDF dues and furnishing clarifications to queries of SDF.

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First Published: Jan 09 2013 | 11:32 PM IST

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