APSFC gets 271 acres to enhance capital base

The Andhra Pradesh government has allotted over 271 acres of land to Andhra Pradesh State Financial Corporation (APSFC) in Hyderabad to help raise its capital base through multiple land use, including establishment of an industrial park.

The value of land allotted is estimated at close to Rs 1,000 crore according to the prevailing market value. This will allow APSFC to go for fresh borrowings of up to Rs 9,000 crore to scale up its business, A Giridhar, managing director, APSFC, said.

The state-run corporation is mandated to cater to the investment requirements of small and medium enterprises in manufacturing and other sectors in the state.

"We are poised to increase the loan sanctions to the SME sector to Rs 1,000 crore this year as compared with over Rs 500 crore last year. Since, we are allowed to borrow 14 times of the networth of the corporation, the land allotted by the government steeply increases our borrowing capacities," he told Business Standard.

The corporation wants to develop an industrial park to create a vendor base in the auto-component sector besides facilitating other commercial ventures, including a star hotel on the land given at Gajularamaram in Rangareddy district.

APSFC proposes to develop the infrastructure in association with other state-owned entities like Andhra Pradesh Industrial Infrastructure Corporation on the 271 acre site, which would be leased out to different activities.

The corporation is targeting a profit of Rs 80 crore during the current financial year from Rs 37 crore last year.

Giridhar said higher profits would help the corporation wipe out the accumulated losses of Rs 83 crore at the earliest. "We would then be in a position to go for the banking licence from the Reserve Bank of India," he added.