Infrastructure Leasing & Financial Services

Infrastructure Leasing & Financial Services Limited (IL&FS) is an Indian state-funded infrastructure development and finance company. It was created by public sector banks and insurance companies.

It operates through more than 250 subsidiaries including IL&FS Investment managers, IL&FS financial services and IL&FS Transportation networks India Limited (ITNL). Its projects include some of the largest infrastructure projects in India including India's longest tunnel, Dr. Syama Prasad Mookerjee Tunnel, which opened for traffic in April 2017. After the company defaulted on its loans in 2018, the Government of India took control of the company and appointed a new board.

IL&FS was formed in 1987 as an "RBI registered Core Investment Company" by three financial institutions, namely the Central Bank of India, Housing Development Finance Corporation (HDFC) and Unit Trust of India (UTI), to provide finance and loans for major infrastructure projects. Gradually, as the organisation needed better financing, it additionally opened itself to two large international players, namely Mitsubishi (through Orix corporation Japan) and the Abu Dhabi Investment authority. Subsequently, Life Insurance Corporation India, Orix and ADIA became its largest shareholders, a pattern that continues to this day.

Currently, its institutional shareholders include Life Insurance Corporation of India (LIC), ORIX and Abu Dhabi Investment Authority, with small shareholdings by a few Indian banks. State Bank of India (SBI) was a share holder till 2017, after which it sold its stake in the company. A few foreign investors including Greenspring associates remain investors in its subsidiary companies, especially IL&FS transportation and IL&FS infrastructure services.

In 2012, A2Z Group acquired the property management subsidiary of IL&FS (IL&FS Property Management & Services Ltd) in a cash and stock deal. The deal was done through its subsidiary A2Z Infraservices Ltd for ₹ 25 crore. While ₹7 crore cash payment was made to IL&FS Infrastructure Equity Fund and IL&FS Employees Welfare Trust, the infrastructure major also took a 20% stake in A2Z Infraservices by way of a stock swap.

In April 2019, its newly constituted board informed investors that the company had 302 entities through which it currently operates.

IL&FS has 256 group companies as of 2018, including subsidiaries, joint venture companies and associate entities. Though on the surface, the company appears to have 23 direct subsidiaries, 141 indirect subsidiaries (including special purpose vehicles for different projects), 6 joint ventures and 4 associate companies, each of them is further subdivided into additional legal entities, with much cross ownership as well as ownership by investment vehicles of various governments.

While some of its subsidiaries (such as IL&FS Transport) ran into high losses in 2018 and found it difficult to repay their loans, others (such as IL&FS investment managers) posted profits of ₹72.5 crore in 2018, a 33% profit after tax.