 "Real estate")
Post the acquisition of Poonawalla Housing Finance by TPG Capital Asia, the company takes on a new identity --- Grihum Housing Finance.
The global private equity firm -- TPG acquired a 99.02 per cent equity stake in the company, taking over from Poonawalla Fincorp earlier this year.
Speaking on the rebranding, Manish Jaiswal, Managing Director and Chief Executive Officer of Grihum Housing Finance said, "Grihum, a portmanteau of 'Grih' (home) and 'Hum' (togetherness), embodies our essence as a company. We are dedicated to fostering collaboration and unity in creating the cherished space of 'Dream Home' for our customers, many of whom are self-made individuals and micro-entrepreneurs in the semi-urban, peri-urban, and rural regions of the country."
According to the company, 62 per cent of the business is from the self-employed informal sector.
The company, which has seen a compound annual growth rate (CAGR) of 28 per cent in its Assets Under Management (AUM) during the last six years, expects to continue that trend and touch an AUM of Rs 11,000 crore by March 2025. Currently, the AUM of the firm stands at approximately Rs 7,500 crore.
Furthermore, TPG has committed to infuse Rs 1,000 crore, out of which Rs 538 crore has already been infused.
The firm has a customer base of over 75,000 that is served by a network of 195 branches, with plans to add 2-3 branches every month.
The firm is also in talks with three life and non-life insurance companies each for a corporate agency license.
Among key ratios, the cost of borrowing by the Housing Finance company stands at 8.1 per cent as of September 30, 2023. The conservative loan-to-value (LTV) ratios are in the average range of 60 per cent to 70 per cent for housing loans. Overall, the LTV ratio is less than 60 per cent.
Speaking on fund-raising plans, the company plans to raise around Rs 2,500 crore in order to boost the growth of AUM through banks, Non-Convertible Debentures (NCDs), and other multilateral agencies.
"Our AUM is growing at 28 per cent. We will close this year at around Rs 8,200 crore. We expect the year after to reach around Rs 11,000 crore. That means approximately an additional borrowing of around Rs 2,500 odd crores. Currently, we have the National Housing Bank (NHB), public and private sector banks, and about 8 to 10 per cent from NCDs. This profile will by and large remain similar. We also expect multilateral agency funding, which we expect to come in next year. So, my sense is that the additional funding of Rs 2,500 crore will get funded through this model,” Jaiswal said.
Further, he added that, “We are one of the very few HFCs which has invested in the country's Residential Mortgage Backed Security (RMBS) structure, and we believe once the structure plays out, that will be the new source of funding which we are looking for amongst HFCs.”
