Reliance Home Fin gains 5% on debut

RHFL IS LOOKING TO RAMP UP ITS AFFORDABLE HOUSING LOAN PORTFOLIO IN VIEW OF THE GROWTH POTENTIAL OFFERED BY THE HOUSING MARKET

MUMBAI: Reliance Home Finance Ltd (RHFL), the demerged entity of Reliance Capital Ltd, made a firm debut on the exchanges on Friday. The Anil Ambani-promoted company ended at ₹109.20, up 5% after listing at ₹104 a share on BSE. The parent company will still hold 51% in the newly created housing finance firm. Reliance Capital shareholders will get a share of Reliance Home Finance for every share of Reliance Capital they hold.

RHFL is looking to ramp up its affordable housing loan portfolio in view of the growth potential offered by the housing market and support from the government in the form of subsidies.

Commenting on the opportunities in the housing finance segment, Anmol Ambani, executive director at Reliance Capital, said that affordable housing will be a major focus area for RHFL.

Reliance Home Finance had assets under management, including securitised portfolio, of ₹13,022 crore as of June 30. The firm offers loans against property, construction finance and affordable housing loans.

“Our focus remains affordable housing and you will see its proportion increasing in our overall book,” Ambani said, referring to the financing opportunities that have opened up for housing finance companies due to Pradhan Mantri Awas Yojana.

At present, the affordable home loan portfolio constitutes 20% of RHFL’S loan book. Together with other kinds of home loans it forms 55% of RHFL’S loan book. This is likely to go up to 65% in the “medium term”.

Ravindra Sudhalkar, executive director and chief executive, RHFL said that the firm expects the assets under management to touch ₹50,000 crore by 2020. He said that the company has seen a compound annual growth rate of 50% in the last three years. RHFL’S gross non-performing assets are 0.8% of its loan assets.

“We will look to build strong retail assets in the home loan segment,” Sudhalkar said.

Shares of Reliance Capital were under pressure, slipping 8.6% intraday before closing at ₹661.55, down 7.83%.

Mint’s