What is LEASE?

A lease is a contract whereby the owner of an

asset grant to another party the exclusive right to use the asset usually for an agreed period of time in return for the payment of rent.

ABOUT LEASE FINANCE.

A lease is an agreement allowing one party to use

anothers property, plant, or equipment for a stated period of time in exchange for consideration.
Leases have become more prevalent as businesses

and consumers look for alternatives to finance the acquisition of fixed assets.
A lease agreement involves at least two parties a lessor (such as a bank), who owns the property, and a lessee, who uses the property.

ESSENTIAL ELEMENTS
Parties to the contract -- Lessor owner of the property/assets that are being leased -- Lessee user of the property/asset. Assets The assets, property or equipment that are being leased. Ownership separated from user . Term of the lease A definite period for which the agreement of lease remains in operation. Lease rentals The amount that lessee pays to the lessor for the lease transaction. Modes of terminating the lease 1) The lease is renewed for a definite period, or 2) The asset reverts back to the lessor, or 3) The asset reverts back to the lessor and the lessor sells it to a third party, or 4) The lessor sells the asset to the lessee.

Types of lease
1) Direct lease -- Bipartite lease -- Tripartite lease. 2) Domestic Lease 3) International Lease -- Import lease -- Cross border lease 4) Operating Lease: An operating lease is particularly attractive to companies that continually update or replace equipment and want to use equipment without ownership, but also want to return equipment at lease-end and avoid technological obsolescence. 5) Finance Lease: A finance lease is a full-payout, non cancellable agreement, in which the lessee is responsible for maintenance, taxes and insurance.

MAP of FINANCE SOURCES

Advantage:
To the lessee : Provides full finance for capital goods. Fixed rate financing, you pay same rent monthly. Tax Benefits. Avoids Conditionabilities. Additional sources of finance. Flexibility in structuring of Rentals.

Advantage:
To the lessor : Full Security Tax Benefits. High Profitability. High Growth Potentials. Simplicity.

Disadvantages:
Restrictions on Use of Equipment. Limitations of Financial Lease. Consequence of Default. High Cost of Leasing. Not flexible.

Leasing Industry Status

Present industry order Only few major players exist

SREI International Finance Sundaram Finance Cholamandalam Finance Mahindra & Mahindra GE Capital Countrywide Finance Citicorp Shriram Finance Tata Finance

SREIs introduction

SREI International Finance Ltd. (SREI) was set up in 1989 Major player in infrastructure project financing Power, Roads and Ports

Market leader in financing infrastructure construction equipment by way of Lease

Total assets under management over US$ 450 million Shareholders Funds of about US$ 50 million Disbursement of more than US$ 265 million during last year

SREIs relationships

Credit rating in AA category signifying high credit quality & high investment grade

Recipient of prestigious Willis Harman Spirit of Work Award 32 offices spread across India Strong alliances with leading global and local vendors such as Caterpillar, Volvo, Ingersoll Rand, JCB, Metso Minerals, Writgen, Vermeer, Atlas Copco, Ashok Leyland, Telcon, L&T, Tata Motors, etc.

Robust customer base including large Indian and multinational corporate

SREIs success factors

Infrastructure focused player with end to end services i.e. advisory, structuring and lending

Offers infrastructure financing across broad spectrum - from small to big projects with strong appraisal, recovery and redeployment mechanism

Innovative solutions to enhance competitiveness securitisation, cobranding, and setting up of equipment bank

Strong customer focus and quick response time enables offering customised products and tailor made solutions

THANK YOU..