The Hindu Business Line : SREI Infrastructure GDR lists on LSE; FII holdings to touch 51% post issue

THE foreign fund holding in SREI Infrastructure Finance Ltd (formerly SREI International Finance) post-GDR issue, will climb to 51 per cent from the earlier 22 per cent, with the balance held by promoters (22 per cent) and Indian public (27 per cent).

The company, having successfully got itself listed today on the London Stock Exchange (LSE), becomes the first Indian outfit in the infrastructure financing business to adopt the GDR route for tapping overseas resources.

SREI already has an international presence through its new outfits in Germany (Bonn-based IIS International Infrastructure Services GmbH), Russia (Moscow-based ZAO SREI Leasing) and London (Aermid SREI Healthcare Finance).

Addressing newspersons here today on the build-up to the GDR issue and the LSE listing, Mr Sunil Kanoria, Director, SIFL, said with the successful closure of the issue which has mopped up Rs 153 crore ($35 million), an additional Rs 35 crore was now being added to SREI's paid-up equity, which will take it to Rs 88 crore. The pre-GDR paid-up base was Rs 53 crore.

He said some 50 per cent of the funds raised through the GDR issue, priced at $4.05, came through institutional investors in the US.

Each GDR represents 4 underlying shares of the company with a face value of Rs 10 each.

Describing the GDR issue as a strategic move by the company to broad-base its investor profile, Mr Kanoria said the proceeds will be used primarily for funding SREI's future growth by strengthening the capital base and thereby increasing its capacity to leverage itself in the market, even to the extent of 7-8 times.

He said with the doubling of capital, the business volumes are also expected to go up substantially. SREI expects to close 2004-05 with a business handled of nearly Rs 1,600 crore. He said the GDR issue was also expected to bring down the cost of funds for SREI in the immediate future.

"We now need to tap the immense opportunities to meet the expectations of the stakeholders, and as a first step, have already stitched together a good team." Asked on the performance during 2004-05, Mr Sunil Kanoria said a 40-per cent topline growth could be expected. SREI's profit after tax for the period ended March 31, 2004 was at Rs 20 crore, and heexpected to top this by at least 30 per cent in 2004-05.

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