Private Equity Capital

Shriram SEPL Composites (SSC)

SSCPL is a joint venture between Strategic Engineering Private Limited, Shriram EPC Limited (SEPC) and India Industrial Growth Fund (IIGF) to produce Glass reinforced plastic (GRP) pipes and liners, which are used as a substitute for steel and concrete pipes for the transport of water, sewage and oil.

SEPL brings its technology and design capabilities to the JV while Shriram EPC will provide its project management skills and its wide network in securing EPC contracts. The JV will also be able to draw down on SEPC’s managerial depth for its operations.

We expect that the demand for pipes in new and rehabilitation of old sewer lines to be a big growth driver, due to the urban renewal program of various cities. This is being federally funded by the Jawaharlal Nehru National Urban Renewal Mission (current corpus is Rs300bn). IDFC-SSKI industry research puts the total Indian pipes market at over Rs100bn in FY08E.

GRP pipes usage is increasing disproportionately for water pipelines and sewer lines in India and it is taking market share from metal and concrete pipes as it has a lower total cost of ownership. We expect this market trend to continue in the future, as well, and may even accelerate from current levels.