India Infoline Investment Services (IIIS) the NBFC arm of the brokerage major is venturing into financing schools and colleges across the country in a major way as part of its thrust to identify niche business segments for loan financing where it can build an early leadership position.

“We are in talks with colleges in Pune, Delhi, Bengaluru and Chandigarh to fund their brownfield expansion plans. We think social infrastructure financing in the country offers huge potential and we believe we can be a critical player in this segment,“ Pratima Ram, president at IIIS told Financial Chronicle.

Pune is considered as an academic hub in Western India with a confluence of a large number of educational establishments, which attract students from all over the country. “We are focusing on functioning schools and colleges with a five year or more track record who are going in for expansion so that the existing cash flows will help support debt servicing and the element of project risk is reduced to that extent,“ said Ram.

In India education of children apart from wedding of daughters is one of the biggest expenditure items for Indian families. A number of families in India in vest heavily in their children's education in the hope of giving them a better life.

This whole focus on education amongst middle class Indians has spawned a huge business right from the pre school stage to private engineering colleges.

“We will focus on funding schools expanding their facilities for students between eight standard to 12th standard, engineering colleges etc. We are currently in discussions with some such institutions to provide them money for expansion against the mortgage of their property,“ said Ram.

In addition to financing educational institutions, IIIS is also focusing on finance of healthcare equipment such as Computerised tomography equipment, Magnetic Resonance Imaging scanners and other such high end equipment sold by firms such as General Electric, Siemens and Philips.

This segment is still a very small percentage of the company's Rs 3,200 croreloan book as it was started only in financial year 2011.

She said that with five lakh doctors across the country, funding the expansion of small hospitals to medium sized ones is an attractive proposition. The company is also extending project loans to medical colleges against the security of equipment and property owned by it.