INSUBCONTINENT EXCLUSIVE:
After the ILFS default, that share is being drastically reduced, perhaps to less than a tenth, as these financiers seek to match their
liability commitments with cash flows from assets.
Piramal Enterprises, IIFL, Edelweiss, and Dewan Housing Finance (DHFL) are among the
leading NBFCs seeking to identify sources of long-term financing that would be linked to their asset profiles, de-risking cash flows
That would mean significantly lower borrowings through commercial papers (CP)
of commercial paper borrowing was at 24 per cent in the September quarter
That share should halve by December-end, said an industry source.
Piramal Enterprises is aiming to keep its CP exposure at 10 per cent of
It was about 20 per cent a few months ago
The company has renewed 70 per cent of its CPS that were due recently
Ajay Piramal, Chairman, Piramal Enterprises, told ET
CP borrowings to almost zero by December from 6 per cent now, said a source
It has already cut the borrowing from high teens over a period of time
Bank term loans, bonds with longer maturities, refinancing facilities, and portfolio sales to banks are now the preferred routes to meet
fund requirements.
Edelweiss group is targeting to bring down CP borrowings to 4-5 per cent by December-end from about 15 per cent now
though bank borrowings are expensive, they will help earn investor confidence and such borrowings should address the asset-liability
