Shriram Housing Finance is Considering The Acquisition of a Cost Effective Housing Lender

Shriram Housing Finance, a subsidiary of Shriram City Union Finance, is aggressively seeking the purchase of a smaller affordable housing lender; nevertheless, a value mismatch may provide an obstacle.

According to estimates, the targeted firm is believed to be worth between INR 2,000 crore and INR 3,000 crore, and negotiations are ongoing.

The company is also contemplating an INR 1 trillion capital issue to fuel its commercial expansion. This will presumably occur in the first quarter of the next fiscal year.Last year, Shriram City Union Finance, which owns 85% of its housing business, invested 500 crore INR in it.

According to the firm, the mortgage lender's loan assets increased by 54% year-over-year to INR 6,546 crore at the end of September and are on course to reach INR 10,000 crore by September 2023, far ahead of its original goal date of March 2024.

Approximately 35-40% of Shriram Housing Finance's business originates from Tamil Nadu, Andhra Pradesh, and Telangana in the south. Another state where it is quite powerful is Gujarat.

On the planned capital raise, the firm intends to examine the possibility of recruiting additional investors.