IL&FS Group stocks locked in lower circuit on buzz of SFIO probe into 5 arms

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26 Aug, 2025 12:21

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Shares of IL&FS Group have hit lower circuits on reports that the law enforcement agencies are probing allegations of fund diversion.

IL&FS Investment Managers and IL&FS Transportation Networks were locked in 5 percent lower circuit, while IL&FS Engineering and Construction was locked in 10 percent lower circuit.

News agency Reuters reported, quoting The Economic Times that the Serious Fraud Investigation Office (SFIO) has narrowed on five arms of Infrastructure Leasing & Financial Services (IL&FS) which may have been involved in fund diversion and mismanagement.

Indian government took control of the debt-laden IL&FS last week after defaults on a string of debt obligations triggered wider concerns about risks in the country's financial sector.

The five companies under SFIO probe are IL&FS Transportation Networks Ltd, IL&FS Financial Services Ltd, IL&FS Energy Development, IL&FS Tamil Nadu Power and IL&FS Engineering and Construction Company, the paper said.

The five firms constitute for more than 50 per cent of the entire group's revenue and may have diverted funds in projects that were worth 300 billion rupees ($4.04 billion), ET reported, citing two government officials.

The Institute of Chartered Accountants of India (ICAI) has also begun probing the matter and issued notices to statutory auditors seeking an explanation, it said.

IL&FS Group, SFIO and ICAI did not immediately respond to requests seeking comment.

(With inputs from Reuters)