IndusInd on the hunt for NBFCs

IndusInd Bank is looking to take over non-banking finance companies (NBFCs). The bank's board is meeting on December 2 to discuss the issue.

According to an industry source, one of the targets could be Ashok Leyland Finance, which is part of the Hinduja group. The bank apparently has plans to pick up more than one NBFC, according to the source.

The promoters' shareholding in Ashok Leyland is currently at 62.98 per cent, while that in IndusInd Bank is at 41.3 per cent.

IndusInd International Holdings currently has a 31.10 per cent equity in IndusInd Bank, while IndusInd Ltd holds 7.04 per cent and Defive Mauritius Holdings has 3.1 per cent stake. Ashok Leyland Finance's core area of business is retail and corporate financing.

The NBFC was promoted by Ashok Leyland and it has 400 branches across the country.

If IndusInd Bank takes over Ashok Leyland Finance, the bank will primarily be able to meet the priority sector financing targets as the NBFC is primarily into truck financing.

Ashok Leyland Finance had posted a profit of Rs 36.22 crore in the six months ended September 30 during the current financial year. It is one of the largest NBFCs in the country.

The bank has informed the Bombay Stock Exchange that the board will meet on December 2 to consider opportunities for business synergies.