Subhash Projects to raise Rs 300 cr via SPV stake sale
SUBHASH Projects & Marketing (SPML), a Kolkatabased infrastructure development company, aims to raise Rs 300 crore to finance its Bhiwandi water project by selling equity of the special purpose vehicle that has been created for implementation of t...
By Pradeep Pandey, ET Bureau |
MUMBAI: SUBHASH Projects & Marketing ( SPML), a Kolkatabased infrastructure development company, aims to raise Rs 300 crore to finance its Bhiwandi water project by selling equity of the special purpose vehicle that has been created for implementation of the plan.
“We are in talks with a couple of private equity and strategic investors,” said executive director Rishab Sethi, without disclosing their identity. A person close to the matter said US-based Water Asset Management LLC and Veolia Water have evinced initial interest to pick up equity in the project. SBI Capital Markets has been advising SPML on the fund raising.
A special purpose vehicle, SPML Bhiwandi Water Supply Management, is setting up the project for Rs 700 crore. The company plans to raise Rs 400 crore debt for the project which is expected to be operational by 2012-13 . SPML will develop the project for Bhiwandi Nizampur Municipal Corporation and will also operate and maintain it for 25 years. “The project has potential of generating Rs 5,000 crore during the period, which will be shared between SPML and the municipal corporation ,” said Mr Sethi.
The Bhiwandi project will supply drinking water to over one million people in the area. It will be one of the largest water management projects under public private partnership by the Maharashtra government after the sector was opened for private players.
The Indian water and waste water market is pegged at $4 billion and is growing at around 12% a year, according to Virtus Global Partner, a global consultancy.
Half of the revenue generated from the sector comes from the government run bodies and the remaining is contributed by the private firms. India plans to invest around Rs 1.4 lakh crore by 2012 for water management . SPML, one of the leading local players, earns about 62% of its revenue from water management services. It is developing projects in Maharashtra, Gujarat , Delhi and Uttar Pradesh. Last year, it registered sales of Rs 1500 crore.
“We are in talks with a couple of private equity and strategic investors,” said executive director Rishab Sethi, without disclosing their identity. A person close to the matter said US-based Water Asset Management LLC and Veolia Water have evinced initial interest to pick up equity in the project. SBI Capital Markets has been advising SPML on the fund raising.
A special purpose vehicle, SPML Bhiwandi Water Supply Management, is setting up the project for Rs 700 crore. The company plans to raise Rs 400 crore debt for the project which is expected to be operational by 2012-13 . SPML will develop the project for Bhiwandi Nizampur Municipal Corporation and will also operate and maintain it for 25 years. “The project has potential of generating Rs 5,000 crore during the period, which will be shared between SPML and the municipal corporation ,” said Mr Sethi.
The Bhiwandi project will supply drinking water to over one million people in the area. It will be one of the largest water management projects under public private partnership by the Maharashtra government after the sector was opened for private players.
The Indian water and waste water market is pegged at $4 billion and is growing at around 12% a year, according to Virtus Global Partner, a global consultancy.
Half of the revenue generated from the sector comes from the government run bodies and the remaining is contributed by the private firms. India plans to invest around Rs 1.4 lakh crore by 2012 for water management . SPML, one of the leading local players, earns about 62% of its revenue from water management services. It is developing projects in Maharashtra, Gujarat , Delhi and Uttar Pradesh. Last year, it registered sales of Rs 1500 crore.
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