GIC Housing plans Rs 50 cr capital infusion

The GIC Housing Finance, one of the top three non-banking housing finance companies in the country, proposes Rs 50 crore capital infusion during the current fiscal to prop up its business expansion plan.

The capital infusion will be under both Tier-I and Tier-II to strengthen the capital base, said A K Guha, chief executive officer of the company.

First, within next six months the company intends to raise Rs 20 crore from the market through rights issue of Rs 10 crore carrying premium of equal amount. Similarly, another Rs 10 crore will be collected through private placement of shares by December 2004, Guha said, adding, Rs 20 to 30 crore will be added to the capital under tier II by the end of the fiscal.

This will take our capital adequacy ratio from 12.5 per cent at present to 16 per cent, sufficient to prop up the intended expansion of business during the year.

The company proposes to add Rs 850 crore fresh business in 2004-05. At present its loan portfolio is Rs 1,050 crore on capital base of Rs 18 crore.

GIC Housing Finance, which has recorded a business growth of 50 per cent over the last two years, is expected to announce a 100 per cent growth in profit for 2003-04 over the previous year's profit of Rs 6.06 crore.