Date:19/04/2005 URL: http://www.thehindubusinessline.com/2005/04/19/stories/2005041901660200.htm

Back Srei Infrastructure mops up Rs 153 cr through GDR issue

Our Bureau

Kolkata, April 18

SREI Infrastructure Finance Ltd (SIFL), formerly Srei International Finance Ltd, has successfully raised Rs 153 crore ($35 million) through the issue of 8.65-million Global Depository Receipts (GDRs).

Priced at $4.05, each GDR represents four underlying equity shares of the company, each with a face value of Rs 10.

The GDRs were placed through a book building exercise. Srei's last equity offering through issue of Compulsory Convertible Preference Shares was in 1996. And with this, Srei becomes the first Indian company in the infrastructure financing business to be listed on the London Stock Exchange.

Commenting on the successful closure of the issue, Mr Hemant Kanoria, Managing Director, said garnering additional resources was essential as the infrastructure in India was poised for an exponential growth and "there are immense opportunities for capitalising on this".

He said the GDR issue was a strategic move by Srei to broadbase its investor profile and for creating another window for overseas investors to participate in the infrastructure growth in India.

Mr Kanoria said that the capital raised would be used to support the growth of the company in the medium and long term. "The overwhelming response to the offering clearly demonstrates the strong confidence and faith that the investor community reposes on the infrastructure focused business model of Srei."

The GDR issue was taken forward by the London-based Jermyn Capital (JC), a boutique investment arm specialising in GDR issues of medium-sized companies. JC has already handled similar mid-size GDR issues for other Indian companies such as Amtech Auto, Gujarat NRI Coke etc.

The company has achieved the GDR listing on LSE after successful roadshows in US, Europe, Singapore and Hong Kong.

According to Mr Sunil Kanoria, Director, the timing of the GDR issue was appropriate for medium-sized Indian infrastructure finance companies, considering the infrastructure boom being witnessed globally, including India. The acceptability of Indian GDRs, especially in the last 6 or 7 months, was quite high given the thrust being given to infrastructure development by the government, he pointed out.

Srei, having already established a pan-India presence with a network of 32 offices, has already ventured overseas and opened offices in Germany, Russia and the UK. The company, according to Mr Kanoria, has grown at a CAGR of over 30 per cent during the last four years.