Pi­ra­mal ex­pands auto sec­tor in­vest­ments

Auto components India - - NEWS - ACI

Pi­ra­mal Fi­nance Ltd, a sub­sidiary of Pi­ra­mal En­ter­prises Ltd, has made in­vest­ments worth Rs 565 crore in 2 trans­ac­tions fo­cussing on the au­to­mo­tive com­po­nent space. The com­pany has fi­nanced RSB Group to the ex­tent of Rs 275 crore, and Indo Shell Mould Ltd to the ex­tent of Rs 290 crore. The in­vest­ments were made through the Cor­po­rate Fi­nance Group (CFG), the erst­while Struc­tured Fi­nance Group, of Pi­ra­mal Fi­nance Ltd, the com­pany noted.

CFG has di­ver­si­fied, both in terms of sec­tor and of­fer­ings, now of­fer­ing cap­i­tal across the risk curve in­clud­ing se­nior debt, ac­qui­si­tion fi­nance, pro­moter fi­nance and pri­vate eq­uity ex­its. It tar­gets bor­row­ers who face con­straints from tra­di­tional chan­nels ow­ing to the cur­rent stress in the bank­ing sys­tem, the com­pany ex­plained.

RSB man­u­fac­tures au­to­mo­tive en­gi­neer­ing prod­ucts, in­clud­ing pro­pel­ler shafts, gears, axles and ma­chined prod­ucts for en­gine com­po­nents and con­struc­tion equip­ment ag­gre­gates. The com­pany has strong do­mes­tic pres­ence with 11 man­u­fac­tur­ing fa­cil­i­ties across ma­jor au­to­mo­tive clus­ters, and caters to all ma­jor OEMs in the com­mer­cial ve­hi­cles, pas­sen­ger cars, con­struc­tion and farm equip­ment space.

Mean­while, Indo Shell is a two-wheeler fo­cussed pre­ci­sion cast sup­plier with a well-di­ver­si­fied cus­tomer base. It has been con­sis­tent in pro­duc­ing high qual­ity en­gine cylin­der blocks at com­pet­i­tive costs and en­joys a healthy or­der book from mar­que two-wheeler OEMs, the com­pany said.

Khushru Ji­jina, Man­ag­ing Di­rec­tor, Pi­ra­mal Fi­nance Ltd, said the au­to­mo­tive com­po­nent space has been on the com­pany’s radar as a fo­cus area for a while now. As stan­dard prac­tise across its plat­form, the com­pany com­mit­ted to an in-depth study of the sec­tor over the past few quar­ters, which has cul­mi­nated in an­nounc­ing these first 2 trans­ac­tions, he added. Ji­jina noted that both RSB and Indo Shell have long stand­ing re­la­tion­ships with ma­jor OEMs and com­mand higher wal­let share of their re­spec­tive cus­tomer set.

The com­pany is pleased to have part­nered with an or­gan­i­sa­tion of such re­pute as be­ing a fi­nancier of choice in the mar­ket to­day, noted RK Be­hera, Chair­man and Man­ag­ing Di­rec­tor, RSB Group. He said this in­vest­ment has pro­vided RSB Group with a long-term so­lu­tion to its cap­i­tal re­quire­ments.

Balaji Ja­gadeesan, Man­ag­ing Di­rec­tor, Indo Shell Mould, said this fund­ing has helped the com­pany solve a cash flow mis­match sit­u­a­tion and also en­abled it to meet in­cre­men­tal de­mand from twowheeler OEMs. In ad­di­tion, Indo Shell is now well placed to cater to ex­port clients in the com­mer­cial ve­hi­cle seg­ment through its new ex­port-ori­ented fa­cil­ity sit­u­ated near Coim­bat­ore, he added.

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