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IFCI (NSE:IFCI) Financial Strength : 3 (As of Sep. 2024)


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What is IFCI Financial Strength?

IFCI has the Financial Strength Rank of 3. It displays poor financial strength and is likely in financial distress. Usually this is caused by too much debt for the company.

Warning Sign:

IFCI Ltd displays poor financial strength. Usually, this is caused by too much debt for the company.

GuruFocus Financial Strength Rank measures how strong a company's financial situation is. It is based on these factors:

1. The debt burden that the company has as measured by its Interest Coverage (current year). The higher, the better.
2. Debt to revenue ratio. The lower, the better.
3. Altman Z-Score.

GuruFocus does not calculate IFCI's interest coverage with the available data. IFCI's debt to revenue ratio for the quarter that ended in Sep. 2024 was 2.03. Altman Z-Score does not apply to banks and insurance companies.


IFCI Financial Strength Calculation

GuruFocus Financial Strength Rank measures how strong a company's financial situation is. It is based on these factors

A company ranks high with financial strength is likely to withstand any business slowdowns and recessions.

1. The debt burden that the company has as measured by its Interest Coverage (current year). The higher, the better.

Note: If both Interest Expense and Interest Income are empty, while Net Interest Income is negative, then use Net Interest Income as Interest Expense.

Interest Coverage is a ratio that determines how easily a company can pay interest expenses on outstanding debt. It is calculated by dividing a company's Operating Income (EBIT) by its Interest Expense:

IFCI's Interest Expense for the months ended in Sep. 2024 was ₹-1,348 Mil. Its Operating Income for the months ended in Sep. 2024 was ₹0 Mil. And its Long-Term Debt & Capital Lease Obligation for the quarter that ended in Sep. 2024 was ₹50,639 Mil.

IFCI's Interest Coverage for the quarter that ended in Sep. 2024 is

The higher the ratio, the stronger the company's financial strength is.

2. Debt to revenue ratio. The lower, the better.

IFCI's Debt to Revenue Ratio for the quarter that ended in Sep. 2024 is

Debt to Revenue Ratio=Total Debt (Q: Sep. 2024 ) / Revenue
=(Short-Term Debt & Capital Lease Obligation + Long-Term Debt & Capital Lease Obligation) / Revenue
=(0 + 50639.1) / 24952.4
=2.03

3. Altman Z-Score.

Z-Score model is an accurate forecaster of failure up to two years prior to distress. It can be considered the assessment of the distress of industrial corporations.

The zones of discrimination were as such:

When Z-Score is less than 1.81, it is in Distress Zones.
When Z-Score is greater than 2.99, it is in Safe Zones.
When Z-Score is between 1.81 and 2.99, it is in Grey Zones.

Altman Z-Score does not apply to banks and insurance companies.

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.


IFCI  (NSE:IFCI) Financial Strength Explanation

The maximum rank is 10. Companies with rank 7 or higher will be unlikely to fall into distressed situations. Companies with rank of 3 or less are likely in financial distress.

IFCI has the Financial Strength Rank of 3. It displays poor financial strength and is likely in financial distress. Usually this is caused by too much debt for the company.


IFCI Financial Strength Related Terms

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IFCI Business Description

Traded in Other Exchanges
Address
IFCI Towers, 61 Nehru Place, New Delhi, IND, 110 019
IFCI Ltd is a financial services company, which provides funding for industrial companies in India. The financing activities cover various kinds of projects such as airports, roads, telecom, power, real estate, manufacturing, services sector and such other allied industries. Lending operations comprise the vast majority of the company's business, and majority of the company's revenue consists of interest income on loans IFCI makes. The Company has played a decisive role in setting up various reputed market intermediaries like stock exchanges, entrepreneurship development organizations, consultancy organizations, educational and skill development institutions across the country.