IFCI keen on raising stake in Stock Holding Corp

IFCI is looking to strengthen its holding in Stock Holding Corporation of India Ltd (SHCIL), the country's largest custodian of shares and other securities.

It is open to acquiring more stake in SHCIL if the other shareholders are willing to offload, Mr Atul Rai, Chief Executive Officer and Managing Director of IFCI, said here on Friday.

“SGCIL is a great business. We are looking forward to increase our stake,” he said when asked if he would prefer IFCI having a controlling stake of 51 per cent in SHCIL.

IFCI had recently bought out ICICI Bank's entire stake — 17 per cent — in SHCIL for about Rs 300 crore. That took IFCI's current holding to about 34 per cent.

Speculation is rife that IFCI may look to gobble up the 17 per cent holding that SUUTI — the restructured arm of the erstwhile Unit Trust of India — has in SHCIL.

If that were to happen, then IFCI can raise its stake to 51 per cent, it was pointed out. Mr Rai however declined to comment on whether IFCI was eyeing SUUTI's stake in the custodian.

Meanwhile, IFCI has reported a net profit of Rs 114.05 crore on a total income of Rs 673 crore for the quarter ended December 31, 2011. The company had recorded a net profit of Rs 152.92 crore on a total income of Rs 635.84 crore in the same quarter in the previous year.

Mr Rai attributed the lower bottom-line performance to increased cost of funds. He also said that the company was not looking to raise any capital for the next two years.

It is looking to conserve capital given the difficult market conditions for raising fresh equity resources. The current complexities in the capital structure is also coming in the way of attracting investors.

krsrivats@thehindu.co.in