IL&FS Investment Managers Limited (IIML) has reported mixed financial results for the quarters ended June and September 2025, while also declaring an interim dividend amidst ongoing investigations and operational challenges.

Financial Performance

For the quarter ended September 30, 2025, IIML reported:

The company's performance showed a significant improvement in Q2 FY2026, primarily driven by a substantial increase in other income, which includes dividend income of ₹2,873.25 lakhs.

Interim Dividend

Despite the challenging environment, IIML has declared an interim dividend of ₹0.50 per equity share, with the record date set for November 21, 2025.

Operational Challenges

IIML faces significant operational challenges:

1. The terms of most existing funds managed or advised by the company and its subsidiaries are nearing their extended end dates.
2. This has resulted in a substantial reduction in fee revenue, with the company generating minimal fee income during the recent quarters.
3. The company's future income is expected to be primarily from the remaining funds under management and project revenues.

Ongoing SFIO Investigation

The company continues to be under investigation by the Serious Fraud Investigation Office (SFIO) of the Ministry of Corporate Affairs. This investigation, initiated in October 2018, involves IIML's parent company, Infrastructure Leasing & Financial Services Limited (IL&FS), and its subsidiaries.

Going Concern and Future Outlook

Despite these challenges, management believes that:

1. Future income from remaining funds and liquid assets held as of September 30, 2025, will be sufficient to meet the company's obligations over the next 12 months.
2. The use of the 'going concern' assumption in preparing financial results remains appropriate.

Resolution Plan and Potential Sale

The IL&FS Board is working on a resolution plan that involves the sale of assets and businesses. In December 2023, IL&FS invited expressions of interest for the sale of its entire stake in IIML. The company reports that several prospective bidders have shown interest, and the process is ongoing.

Consolidated Results Delay

IIML was unable to adopt the Unaudited Consolidated Financial Results for the quarter and half-year ended September 30, 2025. This delay is due to one of its subsidiaries, Andhra Pradesh Urban Infrastructure Asset Management Limited (APUIAML), not finalizing and submitting its Limited Review Results for the period.

Investors and stakeholders should closely monitor the ongoing SFIO investigation and the potential sale of IL&FS's stake in IIML, as these factors may significantly impact the company's future operations and financial performance.

IL&FS Investment Managers Limited (IIML) has reported its unaudited standalone financial results for the first quarter, revealing ongoing challenges for the private equity firm.

Financial Performance

IIML posted a net loss of ₹22.69 lakhs for the quarter. This marks a significant improvement from the loss of ₹334.07 lakhs reported in the same quarter of the previous year. However, the company failed to generate any revenue from operations during the quarter.

The company's total revenue stood at ₹144.67 lakhs, entirely comprising other income, which included fair value gains on investments. This represents a substantial increase from the ₹96.88 lakhs total revenue reported in the corresponding quarter of the previous year.

Expenses and Operational Challenges

Despite the lack of operational revenue, IIML incurred total expenses of ₹167.36 lakhs during the quarter. The major components of these expenses were:

The company's inability to generate fee income during the quarter underscores the challenges it faces as most of its existing managed/advised funds approach the end of their extended terms.

Consolidated Results and Subsidiary Issues

IIML was unable to adopt consolidated results for the quarter due to two of its subsidiaries, Andhra Pradesh Urban Infrastructure Asset Management Limited (APUIAML) and IL&FS Investment Advisors LLC, failing to provide their limited review results. This situation highlights potential governance and reporting issues within the IL&FS group.

Auditor's Observations

The company's auditors, KKC & Associates LLP, issued a qualified conclusion in their limited review report. They cited the ongoing investigation by the Serious Fraud Investigation Office (SFIO) against Infrastructure Leasing & Financial Services Limited (IL&FS) and its subsidiaries, including IIML, as a basis for their qualification. The auditors were unable to comment on the potential impacts of this investigation on the company's financial results.

Going Concern and Future Outlook

The auditors emphasized the material uncertainty regarding IIML's ability to continue as a going concern. This uncertainty stems from the significant reduction in the company's fee revenue and the lack of immediate new fund raises. However, the management believes that the company's estimated earnings and liquid assets will be sufficient to meet its obligations over the next 12 months.

Corporate Actions and Potential Sale

In a significant development, IL&FS, the parent company, invited public Expressions of Interest (EoI) for the sale of its entire stake in IIML on December 21, 2023. The company reported that several prospective bidders have shown interest, and the process is currently underway.

As IIML navigates through these challenging times, the potential sale of IL&FS's stake and the outcome of the SFIO investigation remain critical factors that could shape the company's future trajectory in the private equity and asset management space.