IIFCL Eyes New Heights with Asset-Backed Securities Venture

India Infrastructure Finance Company Ltd (IIFCL) is planning to establish a subsidiary to issue asset-backed securities or covered bonds. This move aims to securitize assets and conserve capital for business growth. IIFCL reported a significant profit increase, driven by enhanced lending and reduced bad loans.

India Infrastructure Finance Company Ltd (IIFCL) is gearing up to establish a subsidiary aimed at issuing asset-backed securities (ABS) or covered bonds. This strategic initiative is designed to securitize its assets, thereby conserving capital and fostering business growth.

In a statement to PTI, IIFCL Managing Director PR Jaishankar highlighted that the company has nearly reached its desired asset size and is now exploring alternative growth avenues. He emphasized that building more assets on existing ones, rather than expanding liabilities, is the goal, which could lead to reduced costs and improved profitability.

During FY24, IIFCL achieved a remarkable 44% increase in net profit, reaching Rs 1,552 crore, thanks to enhanced lending and fewer bad loans. The firm has also seen improvements in asset quality, with significant reductions in gross and net non-performing assets.

(With inputs from agencies.)