Mumbai: Private equity fund Apis has picked up a 25.1 per cent stake in L&T Infra Debt Fund for $110 million, giving the L&T Finance Holdings arm access to low-cost global funds to refinance infrastructure projects in India. L&T IDF has a loan book of Rs 8,000 crore across 94 projects, with 50 per cent of the portfolio guaranteed by a government authority. The company, which started operations in 2013, has no bad loans.
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“Our IDF business has built significant strengths in core areas of renewable energy, road and transmission financing, resulting in a high quality loan book and consistent returns,” said Dinanath Dubhashi, chief executive officer, L&T Finance Holdings.
The investment by Apis Growth Fund II is expected to strengthen L&T IDF’s capital structure and will be used to refinance alternative energy projects such as solar and wind, and highways, which have completed at least one year of satisfactory commercial operations.
“The fund’s investment will support the company in its mission of facilitating infrastructure growth, a critical factor for the development of industry, agriculture and trade in emerging markets,” said Matteo Stefanel, cofounder, Apis Partners LLP.
“The company’s mission is fully aligned to Apis’ own objective of assisting in the deepening of the financial sector as a necessary ingredient for the promotion of economic development in growth markets.”
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IDF-NBFCs are financial institutions set up by the government to solve the typical challenges banks face in infrastructure financing, such as asset-liability mismatches and group concentration limits.
