Manappuram Home Fin eyes Rs 3,000 cr asset size by 2020

Monday, November 14, 2016
Financial Chronicle

Having launched operations last year, Manappuram Home Finance has set a target to achieve an asset size of Rs 3,000 crore by 2020. It also hopes to breakeven by FY18. In the first full year of operations, the company clocked an AUM (asset under management) of Rs 220 crore. It is currently operating in six states – Maharashtra and Gujarat in the west and the four states in the south.

“This year we hope to touch an AUM of Rs 450 crore. We will be getting into Madhya Pradesh and Rajastan and strengthening our presence in Andhra Pradesh and Telengana,’ said Aloke Ghasal, CEO, Manappuram Home Finance. “By 2020, we hope to clock Rs 3,000 crore asset size,’ he added.

Despite having a clientele of 1,800, the company has not tried to fully leverage the customer base of its parent company, Manappuram Finance. “Among our customers, those acquired from Manappuram is very small. We have been choosy while reaching out to Manappuram customers. While the average ticket size of Manappuram Finance gold loan is lesser than Rs 70,000, we are looking at only customers who avail loans above Rs one lakh,” said Ghosal. However, the brand equity of the parent company is helping the company in getting customers.

According to him, growing the business is not difficult for the company considering the needs of the target customer. In terms of interest rate, the company is positioned at the middle of the market. Home Finance companies offer home loan rates ranging from 11 per cent to 18 per cent.

“The segment of customers we deal with are not very particular about pricing. They look for companies which are quick in assessing the loan eligibility and processing the loan faster. Pricing is secondary as they are more concerned about the equated monthly installment,’ he said.

The company has approached National Housing Board for refinancing purposes. It has also received stable rating from Crisil.

‘We will have a calibrated growth. While growing volumes our focus will also be on improving yields,’ he said. Having achieved cash breakeven, it hopes a company-level breakeven by FY18.
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