India Infrastructure Finance Company’s (IIFCL) net profit has more than doubled to Rs 678 crore (Rs 330 crore) for the year ended 31 March 2012, aided by a big jump in net interest margin.
This bottomline performance has encouraged the company to aim for a net profit of Rs 900 crore for the current fiscal, SK Goel, Chairman and Managing Director, IIFCL, said.
The strong net profit performance in 2011-12 is attributed to robust growth in total revenues supported by lower growth in total expenses.
Goel said that IIFCL will this fiscal mobilise about Rs 10,000 crore from the domestic market through tax-free bonds. This will be done in two tranches with the first tranche of Rs 5,000 crore likely to be raised this quarter. The bonds would be issued to retail and institutional investors, he said.
IIFCL has closed deals worth Rs 4,000 crore this year, the highest ever in a six-month period since it was first initiated in 2009. Between 2009 and December last, total deals were worth just Rs 1,500 crore.
Changes in rules on such transactions recently have also made it profitable for banks to sell their loan portfolios to IIFCL which was founded to buy infrastructure loans from banks providing cash to banks to make further loans.
That structure was to offset the asset-liability mismatch of banks that arises due to lending for longer gestation projects from deposits of short maturity of less than two years.
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