SREI identifies new verticals in Medical Equipment, IT

V. K. Varadarajan, Bangalore
The Hindu Business Line
Srei Equipment Finance Pvt Ltd, a 50:50 joint venture between Srei Infrastructure Finance Ltd and BNP Paribas Lease Group, has identified the medical equipment and IT sectors as new verticals for financing.

The company has lent Rs 150 crore to these sectors so far and set a target of Rs 1,000 crore for this fiscal. The company is also contemplating entering agricultural equipment financing, leveraging its French partner’s experience in Europe. BNP Paribas is a leader in financing IT/medical and agricultural equipment financing.

The plan to enter farm sector is still in the drawing board stage. No firm plans have been made, the Chief Executive Officer, D. K. Vyas, told Business Line.

Targets corporates

He said with the company’s expertise in a suite of services, including advisory apart from selling and deploying infrastructure equipment, Srei hopes to fine-tune its pilot for the IT/medical equipment sector – initially aimed at corporates – for evolving a viable business model.

Vyas said: “We are trying to learn the business to fine-tune and evolve a viable business model for this sector.”

The IT sector traditionally depends on banks and captive financing arms of major IT companies for financing equipment.

On Srei’s core business, Vyas said infrastructure sector was emerging as a major focus area for investment from both the Government and private sector. Eyeing the sector’s consolidation in the coming years, particularly with the Budget giving a thrust this year through such rural programmes as Bharat Nirman, Srei hoped to exceed its disbursal target of Rs 7,000 crore this year. It has lent Rs 1,100 crore during the first quarter of this fiscal and hopes to lend Rs 2,000 crore in the second half.

Last year, Srei had disbursed Rs 5,500 crore.

With a market share of 33 percent, Srei wants to strengthen lending activity by launching a partnership campaign to build close relationships with the customers, said Vyas.