Summary of Proposed Investment
Project Number
11349
Company Name
MAHINDRA AND MAHINDRA LIMITED
Date SPI Disclosed
Dec 20, 2001
Country
India
Industry
Financial Markets
Projected Board Date
Jan 31, 2002
Status
Completed
Sector
Finance Companies
Department
Regional Industry - FIG Asia & Pac
Environmental Category
FI
Previous Events
Approved : Apr 16, 2002
Signed : Jun 18, 2002
Invested : Jul 12, 2002
Project Description
The project is to provide Rs.840 million (US$17 million equivalent) in long term local currency funding to MMFSL to: expand its product lines to include new businesses designed to capitalize on the company’s extensive rural branch network; take up insurance products distribution (both life & genera) either through itself or through its subsidiary/associate companies; better match its assets and liabilities; strengthen its capital base to position itself for future growth; and diversify its funding sources by assisting the company to go public at an appropriate time and eventually to raise funds in capital markets.
IFC will have a strong role in the project as it will:
(i) help MMFSL leverage off its extensive rural network to provide new products to rural customers and to help bring rural money into general circulation;
(ii) help to diversify the company’s funding sources both in terms of debt and equity financing;
(iii) provide long-term local currency debt financing to the company which will help it better manage its asset-liability mismatch;
(iv) the project will send an important and positive signal to Indian financial markets and will help improve the image of non-bank financial companies (NBFCs) in India.
The project is expected to have a strong development impact. It will:
(i) contribute to improve access to financial products and services for both rural and semi-urban populations;
(ii) help to deepen rural financial systems by offering a wider range of financial products and services;
(iii) have a demonstration effect for other rural finance institutions and NBFCs, in expanding the range of financial services in rural areas.
IFC will have a strong role in the project as it will:
(i) help MMFSL leverage off its extensive rural network to provide new products to rural customers and to help bring rural money into general circulation;
(ii) help to diversify the company’s funding sources both in terms of debt and equity financing;
(iii) provide long-term local currency debt financing to the company which will help it better manage its asset-liability mismatch;
(iv) the project will send an important and positive signal to Indian financial markets and will help improve the image of non-bank financial companies (NBFCs) in India.
The project is expected to have a strong development impact. It will:
(i) contribute to improve access to financial products and services for both rural and semi-urban populations;
(ii) help to deepen rural financial systems by offering a wider range of financial products and services;
(iii) have a demonstration effect for other rural finance institutions and NBFCs, in expanding the range of financial services in rural areas.
Sponsor / Cost / Location
Development Impact
Related ESRS/ERS
Contacts
For Inquiries About the Project, Contact
Rosy Khanna, Investment Officer
Email: rkhanna@ifc.org
Herbert Lai, Investment Officer
Email: hlai@ifc.org
Email: rkhanna@ifc.org
Herbert Lai, Investment Officer
Email: hlai@ifc.org