Exploring Overseas Investment Finance for Indian Companies

Key Features of Overseas Investment Finance

• Financial institutions provide term loans for:
• Equity investment in overseas Joint Ventures (JV) or Wholly Owned Subsidiaries (WOS).
• Onward lending to overseas JV/WOS.

Term loans to overseas JV/WOS of Indian companies support:

• Capital expenditure for asset acquisition.
• Working capital needs.
• Equity investment in another company.
• Acquisition of brands, patents, rights, or other IPR.
• Acquisition of another company.
• Any other eligible activity that Exim Bank would finance if it were an Indian entity.
• Guarantee facility for raising term loans/working capital for the overseas JV/WOS.

Eligibility Criteria

• Funded/non-funded assistance to the Indian promoter company.
• Financing in INR and/or foreign currency to the Indian borrower and overseas entity, in line with RBI guidelines.
• Commercial interest rates on term finance.
• Loan tenor typically 5-7 years with suitable moratorium.
• Security includes charges on assets of the overseas entity, corporate guarantee of the Indian promoter, risk cover, and pledge of shares held by the Indian promoter in the overseas venture.

Overseas Investment Finance enables Indian companies to diversify, access new markets, and enhance global competitiveness. Through strategic financing options, companies can successfully expand their international presence and contribute to India's economic growth on the global stage. Let’s raise better, to grow better.