AB Nuvo to launch NBFC to fund infra

Just when you thought India's infrastructure story was floundering, a white knight is emerging, and it's taking the form of Aditya Birla Nuvo's finance arm. CNBC-TV18's Ashmit Kumar reports.

The infrastructure sector, particularly the power space, is looking vulnerable. But even as most banks look on nervously, the Aditya Birla Nuvo conglomerate is betting big on the sector. It's finance arm is all set to launch a non-bank financial company (NBFC) that will inject the much-needed funds. Rakesh Jain, managing director of the company said, "It's premature to reveal details but we are looking at infra financing. Despite the concerns, we are confident of growth in this segment." The company is brushing aside concerns like delayed government clearances, high interest rates, and hold-ups in project execution. "The concerns are only short term in nature. In the middle to long term we are confident of the deficit story. If India has to grow at 8% rates, infra will grow," Jain added. Funds for this project, like the conglomerate's other capex plans, will come largely through internal accruals. With an expansion bill envisaged at over one billion dollars, the company is banking on receiving a banking license, and also hopes the government will move quickly on reforms in the fertilizer space.