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SMALL & MEDIUM ENTERPRISE (SME) FINANCE

The importance of SME sector is well-recognized world over, owing to its significant contribution in achieving various socio-economic objectives. India also has a vibrant SME sector that plays an important role in sustaining economic growth, increasing trade, generating employment and creating new entrepreneurship in India. Indian SME companies are increasingly resorting to external financing as a means to consolidate and grow rapidly. The liberalisation of the Indian economy and the reform programme has opened the door to valuable challenges, for SME organizations to create and strengthen their competitiveness & resilience in the global arena.

The small size of SME units makes them more competitive, as they can easily adapt to technological changes, respond quickly to changed economic conditions by changing production capacities with varying demand- supply, and can efficiently take care of customised products required to satisfy the demands of niche segments in export markets having sufficient margins. These factors help SME organizations to increase the market share of their products & services, and to compete effectively with the multinationals in the global market place. Efforts made by the government and leading financial institutions in this direction have added much needed financial strength to the SME sector. All this has resulted in an increased level of focus and attention towards creating a strong, but self reliant, SME market place via constructive public-private participation.

Global Absolute provides an opportunity for SMEs to leverage from the knowledge and rich experience of its team, in satisfying the ever growing financial needs of SMEs. Deep understanding of capital markets and marque of existing relationships with leading financial institutions help Global Absolute to place various financials instruments with reliable investors in shortest possible timeframe. The investment banking team also provides quality advisory services to SMEs for raising funds via seed capital, bridge finance, venture capital, private equity placements, pre IPO advisory and placement with high net worth private Investors, etc.

Global Absolute’s Investment banking team is industry focused and brings measurable value to its clients, in growth, competitiveness and profitability. Any transaction, be it fund-raising, or strategic alliances, are usaually intense, time-consuming, and so, requires a concerted effort from start to finish. Our end-to-end approach and taking ownership of the client issues ensure that the client can focus on business, without getting distracted by the transaction on hand. In addition, we have a systematic approach to our engagements, so that we leave no loose ends, and all the issues are addressed to our client's satisfaction.

Our Investment banking team formulates a set of rules, based on which it provides growth capital to emerging SMEs across all sectors, having at least the following criteria, among other things:

Clear customer need for the products/services offered, ideally demonstrated by a sales track record
Sustainable competitive advantage and convincing strategy for marketing, selling and delivering products in the face of competition
Strong, dynamic and experienced management teams that are personally and financially committed to the company
Proven track record of good potential for growth in sales, profits and shareholder value
Stable and consistent cash-flows
Potential to generate a significant upside at the time of exit

The process of making Investments in SME projects includes the basic understanding and knowledge in the following key areas:

 
Macroeconomics  

Market Analysis

 
 
Financial Modeling  
Cost Analysis  
 
Forecasting Projections  
Diversification of Product Portfolio  
 
Cash flow Analysis  
Risk Analysis  

These are the typical considerations for making Investment Banking decisions at Global Absolute. We believe that with the right strategy, management and operational assistance, SME companies will be able to leverage their existing market position and create significant value over a period of 3-5 years.

We assist our clients in follow-ups for financing requirements, and provide investment banking services to companies at different stages of maturity and in difficult market conditions, thus helping the companies to access the pool of capital that balances business valuation and promoter needs. Global Absolute plays the role of a full lifecycle investment bank by means of having access to leading financial institutions, and its vast network of existing clients / investors.

Global Absolute’s team, after having a discussion with the company’s management, prepares a detailed business plan and a financial model for the company, incorporating industry / market analysis to understand the industry profile, growth prospects and competitive scenario. During the process, we also prepare the necessary documents, namely an investor presentation, teaser and a comprehensive information memorandum that would be required to interface with prospective Investors. We coordinate the complete due diligence (legal & financial) process and negotiate on the finer issues, culminating in signing of definitive agreement and deal closure. We also offer post transaction advice and support, to ensure that the transaction objectives are met. As advisors, we do gain access to confidential client information and pledge to maintain the trust that our clients place in us.

 

Our SME Services cover :

 
Seed Capital / Bridge Finance  

Private Equity Placement

 
 
Venture capital funding  
Corporate Restructuring  
 
Capital Markets Advisory  
Pre-IPO fund raising  
 
Syndication of debt Instruments (FCCB, ECB, etc.)  
Value Added Services  
             
   
             
 
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