IFCI full form is Industrial Finance Corporation of India. It was established as a Statutory Body in 1948. It was formed to provide finances to businesses. Further, in 1956, IFCI became a Public Limited Company (PLC) under the 1956 Companies Act. At present, the Industrial Finance Corporation of India is primarily owned by the central government of India. Additionally, IFCI is a public financial entity as per Section 2 Clause 72 of the 2013 Companies Act. The corporation is also registered as Systemically Important Non-Deposit Taking NBFC (Non-Banking Finance Company) with the RBI (Reserve Bank of India).
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Functions of IFCI
- It offers long-term financial assistance to industrial projects in the form of term loans. These loans help finance capital expenditures, such as the purchase of machinery and equipment, construction of factories, and expansion of existing facilities.
- IFCI plays a crucial role in project financing by evaluating the technical, economic, and financial viability of industrial projects. It conducts project appraisals to assess the feasibility and potential risks associated with the projects. Based on its evaluation, IFCI provides financial support to viable projects, facilitating their establishment and growth.
- The corporation assists companies in raising funds from the capital markets through underwriting and direct subscription. It helps in the issuance of securities such as shares, debentures, and bonds by providing financial support and ensuring the successful completion of capital-raising activities.
- It actively contributes to the promotion of industrial development in India. It provides advisory services, technical assistance, and guidance to entrepreneurs and industrialists.
- It offers refinancing and rediscounting facilities to financial institutions and banks. It provides funds to these institutions against the security of eligible industrial assets. This helps enhance the liquidity of financial institutions, enabling them to provide further credit to industrial projects.
- IFCI participates in the equity capital of industrial companies by acquiring shares or equity stakes. Through equity participation, IFCI becomes a shareholder in these companies and contributes to their capital structure. This allows IFCI to support and monitor the progress of the companies it invests in.
- It provides advisory services related to industrial and financial matters. It offers consultancy on project appraisals, corporate restructuring, financial management, and other areas of expertise. These advisory services help businesses make informed decisions and improve their operational and financial performance.
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Subsidiaries of IFCI
The Industrial Finance Corporation of India has numerous subsidiaries, which are as follows:
- IFCI Financial Services Limited
- IFCI Factors Limited
- IFCI Venture Capital Fund Limited
- IFN Securities Limited
- IFN Credit Limited
- IFCI Infrastructure Development Limited
- IFCI Limited, Asset Management
- IFCI Sycamore Capital Advisors Private Limited
- Stockholding Corporation of India Limited
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