Sagarmala Finance Corporation Ltd (SMFCL) has started operations as an exclusive lender to the country's maritime sector, with its board on Tuesday sanctioning some Rs 4,300 crore for disbursement during the current fiscal, of which about Rs 100 crore will be lent to state-run Goa Shipyard Ltd for expansion.

Including the Rs 4,300 crore scheduled for disbursement in the current fiscal, SMFCL aims to build a loan book of Rs 8,000 crore in FY 2025-26 to strengthen its position in maritime financing. The state-run lender is awaiting rating assignments from top rating agencies, which will further enhance its ability to leverage borrowing costs, the company said.

Goa Shipyard has sought funds from SMFCL to expand the yard. It will likely become the first to receive funding from SMFCL, a government official said.

The SMFCL board had earlier approved an overall borrowing limit of Rs 25,000 crore, including Rs 8,000 crore for FY26.

Maritime funding push

The ambitious strategy charted by SMFCL is further backed by strong support from the Union Ministry of Ports, Shipping and Waterways, which has designated it as the nodal agency for setting up and operationalising the flagship Maritime Development Fund of Rs 25,000 crore, comprising Rs 20,000 crore as Maritime Investment Fund (MIF) and Rs 5,000 crore as Interest Incentivization Fund (IIF).

SMFCL will hold and manage the Union government's contribution to the alternate investment fund (AIF) established for MIF against the government's contribution in fiduciary capacity. Further, SMFCL is the nodal agency to channelise the IIF of Rs 5,000 crore, which will also expand its funding scope in the maritime sector.

Lending framework outlined

Based on its current net worth of Rs 1,200 crore, SMFCL has the nod from the government on the back of Reserve Bank of India (RBI) guidelines to lend as much as Rs 500 crore to the public sector and up to Rs 100 crore to the private sector for individual projects to start with, the government official said.

Presently, SMFCL will disburse funds preferably in debt only though it can go for equity participation also," the government official said.

"In its scope, the entire spectrum of the maritime sector is covered," he added.

"If SMFCL gets good projects for equity participation such as ship owning SPVs or shipyards, it will go for it because it has the license to do that," he said.

The lender, in its earlier avatar as Sagarmala Development Corporation Ltd, was established to provide equity support to maritime-sector projects. The company holds equity in five project special purpose vehicles (SPVs) from which it has no plans to exit.

SMFCL is not going to divest its equity in the five SPVs because it is getting attractive dividends from them," the government official added.

SMFCL said it will offer tailored loan products to all eligible government and private sector entities operating in the maritime sector. This covers short-, medium-, and long-term lending, including cash flow mismatches, balance sheet financing, and non-fund-based products.

Source: ET Infra. Com 

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