Chola 2022 Loan (IFC-46715)

Regions
  • South Asia
Geographic location where the impacts of the investment may be experienced.
Countries
  • India
Geographic location where the impacts of the investment may be experienced.
Financial Institutions
  • International Finance Corporation (IFC)
International, regional and national development finance institutions. Many of these banks have a public interest mission, such as poverty reduction.
Project Status
Active
Stage of the project cycle. Stages vary by development bank and can include: pending, approval, implementation, and closed or completed.
Bank Risk Rating
FI
Environmental and social categorization assessed by the development bank as a measure of the planned project’s environmental and social impacts. A higher risk rating may require more due diligence to limit or avoid harm to people and the environment. For example, "A" or "B" are risk categories where "A" represents the highest amount of risk. Results will include projects that specifically recorded a rating, all other projects are marked ‘U’ for "Undisclosed."
Voting Date
Jun 30, 2022
Date when project documentation and funding is reviewed by the Board for consideration and approval. Some development banks will state a "board date" or "decision date." When funding approval is obtained, the legal documents are accepted and signed, the implementation phase begins.
Borrower
CHOLAMANDALAM INVESTMENT AND FINANCE COMPANY LIMITED
A public entity (government or state-owned) provided with funds or financial support to manage and/or implement a project.
Sectors
  • Finance
The service or industry focus of the investment. A project can have several sectors.
Investment Type(s)
Loan
The categories of the bank investment: loan, grant, guarantee, technical assistance, advisory services, equity and fund.
Investment Amount (USD)
$ 150.00 million
Value listed on project documents at time of disclosure. If necessary, this amount is converted to USD ($) on the date of disclosure. Please review updated project documents for more information.
Loan Amount (USD)
$ 150.00 million
Value listed on project documents at time of disclosure. If necessary, this amount is converted to USD ($) on the date of disclosure. Please review updated project documents for more information.
Project Cost (USD)
$ 350.00 million
Value listed on project documents at time of disclosure. If necessary, this amount is converted to USD ($) on the date of disclosure. Please review updated project documents for more information.
Primary Source

Original disclosure @ IFC website

Updated in EWS Jun 20, 2024

Disclosed by Bank May 26, 2022

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Project Description
If provided by the financial institution, the Early Warning System Team writes a short summary describing the purported development objective of the project and project components. Review the complete project documentation for a detailed description.

According to IFC, the proposed project comprises of an up to US$350 million investment in Cholamandalam Investments & Finance Company Limited (Ltd) (CIFCL, the Company) through a 3-year US dollar (USD)-denominated senior secured loan. IFC will provide up to US$150 million through its own account, and mobilize up to US$200 million from other lenders, with an unspecified greenshoe. The proposed project supports vehicle financing for micro, small and medium enterprises (MSME), with a focus on the low-income states (LIS) and rural regions of India. The Covid-19 pandemic has aggravated the already weak economic environment for this segment since they are less resilient to exogenous shocks. Thus, this project is part of IFC’s systematic approach in India where IFC will work with different financial institutions (FIs) to continue to support the recovery of MSMEs from the Covid-19 pandemic and stimulate growth.      

Invested on July 19th 2022.                                            

Investment Description
Here you can find a list of individual development financial institutions that finance the project.

The proposed project comprises of an up to US$350 million investment in CIFCL through a 3-year USD-denominated senior secured loan. IFC will provide up to US$150 million through its own account, and mobilize up to US$200 million from other lenders, with an unspecified greenshoe. The proposed project supports vehicle financing for MSMEs, with a focus on the LIS and rural regions of India.         

Financial Intermediary
A financial intermediary is a bank or financial institution that receives funds from a development bank. A financial intermediary then lends these funds to their clients (private actors) in the form of loans, bonds, guarantees and equity shares. Financial intermediaries include insurance, pension and equity funds. The direct financial relationship is between the development bank and the financial intermediary.
Private Actors Description
A Private Actor is a non-governmental body or entity that is the borrower or client of a development project, which can include corporations, private equity and banks. This describes the private actors and their roles in relation to the project, when private actor information is disclosed or has been further researched.

CIFCL is one of the leading asset financing NBFCs in India with assets under management (AUM) of USD 9.98 billion as on 31 March 2022, with a very strong distribution network that caters to over 1.87 million customers through 1,145 branches across India. The company primarily lends to MSME clients in the transportation sector that are economically weak, have limited credit history and therefore are unable to raise funds from commercial banks.

CIFCL is listed on the Bombay Stock Exchange and National Stock Exchange and has a market capitalization of USD 7.1 billion as of 20 May 2022. As of 29 April 2022, 52 percent of CIFCL’s shares were held by the promoter & promoter group, 18 percent were held by foreign institutional investors, 21 percent were held by mutual funds, 6 percent were held by public shareholders, and 3 percent were held by others.

 CIFCL is headquartered in Chennai, Tamil Nadu and has 1,145 branches across India.                                                 


Contact Information
This section aims to support the local communities and local CSO to get to know which stakeholders are involved in a project with their roles and responsibilities. If available, there may be a complaint office for the respective bank which operates independently to receive and determine violations in policy and practice. Independent Accountability Mechanisms receive and respond to complaints. Most Independent Accountability Mechanisms offer two functions for addressing complaints: dispute resolution and compliance review.

Cholamandalam Investment and Finance Company Limited
Mr. Hardik D. Pandya
Assistant Vice President – Treasury
+9122 40253308
hardikdp@chola.murugappa.com
Dare House, 1st Floor, 2, NSC Bose Road, Chennai 600001, Tamil Nadu, India


ACCESS TO INFORMATION

You can submit a request for information disclosure at: https://disclosures.ifc.org/#/inquiries

If you believe that your request for information from IFC has been unreasonably denied, or that this Policy has been interpreted incorrectly, you can submit a complaint at the link above to IFC's Access to Information Policy Advisor, who reports directly to IFC's Executive Vice President.

ACCOUNTABILITY MECHANISM OF IFC/MIGA

The Compliance Advisor Ombudsman (CAO) is the independent complaint mechanism and fact-finding body for people who believe they are likely to be, or have been, adversely affected by an IFC or MIGA- financed project. If you submit a complaint to the CAO, they may assist you in resolving a dispute with the company and/or investigate to assess whether the IFC is following its own policies and procedures for preventing harm to people or the environment. If you want to submit a complaint electronically, you can email the CAO at CAO@worldbankgroup.org You can learn more about the CAO and how to file a complaint at http://www.cao-ombudsman.org

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