IFCI Limited has received an income tax rectification order under Section 154 of the Income Tax Act, 1961, creating an additional tax demand of ₹13.64 crores. The company disclosed this development to stock exchanges on January 06, 2026, in compliance with SEBI listing regulations.

Tax Order Details

The Assistant Commissioner of Income Tax issued the order under Section 154 read with Section 143(3) of the Income Tax Act, 1961. The additional demand stems from the department's decision to reduce brought-forward losses in the computation of income for Assessment Year 2019-20.

Company's Response and Legal Position

IFCI Limited has indicated that the original assessment order and demand for Assessment Year 2019-20 is already under appeal before the Commissioner of Income Tax (Appeals). The company has successfully obtained a stay against the existing demand and plans to file an application for stay against this additional demand as well.

The rectification order specifically addresses the reduction of brought-forward losses in the income computation, which has resulted in the increased tax liability for the company.

Financial Impact Assessment

Despite the substantial additional demand, IFCI Limited has assessed that there will be no material impact on its financial position. The company has disclosed that it maintains sufficient Minimum Alternate Tax (MAT) credit that can be utilized to absorb the additional demand.

Regulatory Compliance

The disclosure was made pursuant to Regulation 30 read with Schedule III Para A Part A of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. Company Secretary Priyanka Sharma signed the regulatory filing, ensuring compliance with mandatory disclosure requirements for listed entities.

The company emphasized that while the additional demand represents a significant amount, the availability of MAT credit provides adequate protection against immediate financial impact, allowing normal business operations to continue without disruption.

State-owned IFCI shares surged 7.30% to ₹54.12 during Wednesday's trading session following the company's announcement of monetising its equity stake in North Eastern Development Finance Corporation Ltd (NEDFi) for ₹121.77 crore. The transaction forms part of the company's broader consolidation strategy at the group level.

Transaction Details

The divestment involved the sale of one crore equity shares in NEDFi, representing a 10% equity holding that IFCI had originally acquired at a cost of ₹10.00 crore. The strategic sale represents a significant return on the company's initial investment in the northeastern development finance institution.

Market Performance and Technical Analysis

Despite the sharp rally, the stock remains below its 52-week high of ₹74.50, with the 52-week low standing at ₹36.20. Over the past year, IFCI shares have declined by around 13%, though the stock has delivered a strong rally of nearly 300% over the last three years.

On the technical front, the 14-day Relative Strength Index (RSI) stands at 48.80, indicating neutral momentum. The stock is trading above 5 out of its 8 key simple moving averages, suggesting a mildly bullish trend.

Institutional Interest and Financial Performance

Institutional investors have shown increased interest in IFCI during the September quarter. Foreign Institutional Investors (FIIs) marginally raised their shareholding from 2.52% to 2.60%, while Mutual Funds increased their stake from 0.11% to 0.12%.

IFCI reported September quarterly revenue of ₹752.00 crore, reflecting a year-on-year decline of 4.30%. However, quarterly net profit stood at ₹143.00 crore, registering robust 73% year-on-year growth, indicating improved operational efficiency.

Group Restructuring Initiative

This divestment aligns with IFCI's comprehensive consolidation plan approved by the board in July. The restructuring strategy includes the merger of key subsidiaries into the parent company, specifically StockHolding Corporation of India, IFCI Factors Ltd, IFCI Infrastructure Development Ltd, and IIDL Realtors.

Additionally, the board has proposed consolidating broking-related entities including StockHolding Services, IFCI Financial Services, IFIN Entities, IFIN Credit, and IFIN Securities into a single platform. Post-merger, IFCI will continue operating as a non-banking financial company (NBFC) while pursuing opportunities in custodial services, e-stamping, and advisory segments.