CME industry to grow faster at 14% over 2018-20: Srei

Our disbursements were Rs 8,309 crore during the six-month period April-September 2017. As on 30th September 2017, our asset under management stands at Rs 26,525 crore.

DK Vyas, CEO, Srei Equipment Finance

Srei Equipment Finance Limited, a wholly-owned subsidiary of Srei Infrastructure Finance Ltd, is in the field of equipment finance with assets under management of Rs 26,525 crore. In an interview with Subhajit Roy, Srei Equipment Finance’s CEO DK Vyas talks about the company’s performance. Excerpts:

What’s your comment on the performance of construction equipment finance sector?

The construction mining and allied equipment (CME) market started showing positive growth since January 2016 after a period of de-growth from fiscal 2013 until September 2015, and flat growth during October to December 2015. The industry witnessed a slight reduction in sales numbers during December 2016 due to demonetisation and reduction in retail sales. The growth rate then increased by 7 per cent during fourth quarter of fiscal 2017 as compared to the third quarter of fiscal 2017. The overall Indian CME industry grew by 32 per cent in fiscal 2017 compared to fiscal 2016. The CME industry is expected to grow at a CAGR of 14 per cent for next three years (fiscal 2018 to fiscal 2020) to reach a volume of 125,000 units and at a CAGR of 18 per cent by value to reach a value of Rs 49,000 crore.

How do you see the recent performance of NBFCs and more specifically your company in this context?

We operate a business model providing end-to-end solutions across the equipment lifecycle from procurement, deployment, maintenance, second life financing to exit. This has helped us improve our portfolio, asset quality, disbursement and book size. Our position in the CME sector and brand name has helped us to expand to other sectors such as Tippers, IT and allied equipment, medical and allied equipment, farm equipment and other assets, which present both greenfield and brownfield opportunities. As on FY 2017 we had around 32.7 per cent market share.

How did Srei Equipment Finance perform during the past one year?

Our disbursements were Rs 8,309 crore during the six-month period April-September 2017. As on 30th September 2017, our asset under management stands at Rs 26,525 crore.

In 2018, are you going to evolve your disbursement portfolio?

In the recent past, we had a good growth in our portfolio as well as disbursement. In future too, we would continue to focus on growing our disbursements and improving asset quality.

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