Indiabulls Housing plans to raise Rs 50k cr growth capital by FY23

Indiabulls Housing Finance is planning to raise Rs 50,000 crore by the next financial year (FY) to fund its expected 15-20% loan growth.

The outstanding loan book of the company stood at Rs 74,800 crore as of February-end, and if it grows by the upper end of the mark it may close Rs 90,000 crore of loan book per Assets Under Management (AUM) by the next fiscal year. The board approves fundraising of Rs 50,000 crore to fund loan growth next fiscal year to double from the last fiscal year at Rs 26,000 crore.

Deputy Managing Director of Indiabulls Finance, Ashwini Hooda, told the media that the company had raised Rs 26,000 crore in the outgoing fiscal year as loan growth was muted with a negative bias with the loan book of Rs 74,800 crore.

From this, the commercial real estate builder loans stood at Rs 13,600 crore, down from Rs 20,900 crore.

The reason for the failed takeover of Laxmivilas Bank in 2019 was the group’s high exposure to the trouble-prone realty sector. The group had planned to convert itself into a bank with the takeover attempt.

Hooda said that the company raises 60% from bank loans, 30% through securitisation and the remaining 10% by issuing Non-Convertible Debentures (NCDs) or External Commercial Borrowings (ECBs).

To date, it raised Rs 26,000 crore in this fiscal year, Rs 1,300 crore from bonds, around Rs 2,000 crore from foreign bonds and around Rs 8,000 crore from securitisation and the remaining Rs 14,000-15,000 crore from banks.

On average, its cost of funds in FY22 stood at 7.5% but expects to increase the next fiscal year, given the pressure from inflation.

Hooda told the media that despite muted growth, asset quality remains stable this fiscal year, with Gross Non-Performing Assets (NPAs) 3.25% or about Rs 2,000 crore.

He said that the company has a 150% provision coverage ratio, or Rs 3,000 crore has been provided.

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Also read: Indiabulls Housing Finance plans to raise 1,000 cr via public bonds