 "Kanorias for investment in road, power sectors")
According to Hemant Kanoria, chairman and managing director, Srei Infrastructure Finance, the money raised from the Viom deal will be used for fresh investments in road and power projects. Diluting stake in some of the road projects, investing in newer ones, and increasing stake in India Power Corporation Limited (IPCL) — in which the Kanoria family holds around 68 per cent stake — are some of the investment plans.
This apart, the cash from the Viom deal will also help the company reduce its debt, which at present stands around Rs 28,000 crore.
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Srei manages its road projects through Bharat Road Network Limited (BRNL), which runs road projects through special purpose vehicles.
“In some of the companies, we will dilute our stake, like the road company. Unlike the tower business, we do not want to exit, but only want to dilute our stake. We are also looking at acquisitions in the road sector. So we may utilise some money in that sector,” said Kanoria.
So far, BRNL has executed 14 road projects worth Rs 12,753 crore. At present, it manages a build-operate-transfer (BOT) asset portfolio of close to 2,450 (lane) km of highways, with a capital cost of over Rs 7,901crore. These projects are complete, or are under implementation in consortium with domestic and international partners, under the public-private-partnership framework.
In the road sector, Srei would also vet options like IPO, for raising capital.
“The road sector has not started picking up. Once it does, we will look into all options, like IPO, private equity or sovereign fund,” Kanoria added.
India Power Corporation Ltd (IPCL), formerly known as DPSC Limited, is primarily in the business of power distribution, along with renewable and conventional power generation sectors. The company is setting up a 450-Mw thermal power plant in Haldia, West Bengal, and has also conceived thermal power projects in Bihar and Madhya Pradesh.
“There are opportunities in the power sector, as they are not doing well due to stress. We are looking to expand in India Power. There is requirement of debt and equity in the company. So, for equity, they might come to Srei,” Kanoria said.
This year, Srei Infrastructure Finance is eyeing a growth of 10-15 per cent. It had earlier projected a growth of 15-20 per cent. The target was moderated due to sluggish growth in the infrastructure sector.
“This year, though, we may see 15-20 per cent growth in the loan book. In the infrastructure side we do not see much growth coming, the next six months. Hence, we see a 10-15 per cent growth at Srei. There are policy hurdles, which are yet to be addressed,” Kanoria added.