At least 72 of the 122 Indian subsidiaries of debt-laden Infrastructure Leasing & Financial Services Ltd (IL&FS), which is currently facing a financial crisis and has defaulted on debt repayments, have booked losses in financial year 2017-18. And outside India, too, the IL& FS Group has been facing financial troubles with at least 25 of its 53 foreign subsidiaries booking losses for the fiscal 2018, according to its latest annual report.
IL&FS Tamil Nadu Power Company Ltd has booked the biggest loss of Rs 3,821.15 million, followed by IL&FS Maritime Infrastructure Company Ltd at Rs 3,171.91 million and Rapid MetroRail Gurgaon South Ltd at Rs 2,432.88 million. Earlier this month, a clutch of lenders initiated bankruptcy proceeding against IL&FS Tamil Nadu Power Company and took it to the National Company Law Tribunal (NCLT) after it defaulted on loan payments. The power company operates a 1,200 MW imported coal-based plant in Cuddalore.
According to the 2018 annual report of IL&FS, at least 82 Indian subsidiaries of the group do not have enough assets to cover borrowings or total liabilities. Some of these subsidiaries include IL&FS Transportation Networks Ltd, IL&FS Energy Development Company Ltd and IL& FS Financial Service Ltd.
The IL&FS Group has been facing financial troubles with at least 25 of its 53 foreign subsidiaries booking losses for fiscal 2018. IIPL USA LLC, a subsidiary of IL&FS has made a loss of Rs 284.37 million, followed by IL&FS Maritime Offshore Pte Ltd at Rs 282.04 million and IL&FS Prime Terminals FZC at Rs 229.03 million. As many as 32 foreign subsidiaries of the group spread across the globe from Colombia, Brazil, Mexico, Spain, Portugal, Albania, Nigeria, Singapore, Vietnam and Philippines do not have enough assets to cover borrowings.
Most of the foreign subsidiaries and step down subsidiaries of the IL&FS Group are involved in construction, operation and maintenance of road projects and gas stations. The IL&FS group which has liabilities of over Rs 91,000 crore has defaulted on repayments thrice in the last one month. As per the annual report, the remuneration of the top three key managerial personnel — former chairman Ravi Parthasarathy, Hari Sankaran, VC & MD and Arun K Saha, joint MD & CEO aggregated to Rs 498.17 million (Rs 49.8 crore). While the average percentage increase in the salaries of employees other than managerial personnel in financial year 2018 is 4.44 per cent, the average percentage increase in the managerial remuneration was 66 per cent, the annual report said. IL&FS made a loss of Rs 1,886.85 crore in financial year 2018 as against a profit of Rs 141 crore a year ago.