Tourism Finance Corporation of India (TFCI) is planning to tap private equity firms for its equity expansion as it seeks to finance large infrastructure projects and has ruled out plans to launch a follow-on public offering (FPO) soon.
“Based on my profitability statement, I will try to raise further capital, whe-ther from promoters or from other sources. Private equity would be one of the options,” Archana Capoor, chairman and managing director of TFCI, told FC.
“I am not thinking of an FPO right now. We would like to improve out earnings per share (EPS), which stands at Rs 3.6, and then consider going to the public again,” she said.
Capoor said the company planned to expand equity since it had taken a decision to enter infrastructure financing by participating in consortiums of banks and financial institutions. TFCI has paid-up capital of Rs 80 crore.
“We will be focusing only on three or four areas: power, roads, airports and ports. If I have to do core infrastructure funding then I will have to do it through consortia. Since most of these projects would fall into the big category in terms of ticket size, we will have to go along with other lenders,” she said.
Capoor said, though the company planned to start with modest lending during the present financial year, it was targeting a portfolio of around Rs 5,000 crore in five years. TFCI’s present loan book stands at Rs 1,000 crore.
“This year our total disbursements would be around Rs 500 crore, out of which infrastructure funding would be around Rs 200-250 crore. I plan to take the infrastructure funding portfolio to about Rs 5,000 crore in five years,” she said.
TFCI board is expected to clear guidelines for infrastructure funding at a meeting in May. The board has already approved the company’s plan to widen its financing business.
“We have been receiving many queries but can take up projects only after the board clears the guidelines. As of now, we have been getting queries mainly for hydropower and road projects,” Capoor said.
Source: My Digital FC