This is the first public bond sale by the lender this fiscal.”Our business is doing well, supported by good credit demand. So, it is a good time to raise capital and increase liquidity,” Nirmal Jain, managing director, IIFL Finance, told ET. “Investors are also looking for fixed income options,” he said.
The Fairfax-backed company saw its standalone assets under management more than double year-on-year to Rs 49,000 crore, with gold loans accounting for around 90% of advances. Gold loans have almost tripled in a year.
“The retail bond will help diversify our source of funding,” Jain said.
It has an outstanding loan of nearly Rs 34,000 crore, with bank loans accounting for about 35% while bonds account for about 25%, an official said. Within bonds, the share of retail bonds is 7%. The remaining 40% is divided between securitization and other sources (29%) and foreign loans (11%). Proceeds from the fundraising will be used for further lending, refinancing of existing loans and general corporate purposes, in accordance with regulatory guidelines.
In addition to gold loans, IIFL Finance provides loans to small businesses, classified as micro-small and medium enterprises. .
The IIFL group has exposure to the home loan and microfinance market through its subsidiaries called IIFL Home Finance and IIFL Samasta Finance. Their combined assets under management stood at Rs 98,336 crore.
IIFL Home Finance, which is 80% owned by IIFL Finance, has Rs 39628 crore AUM. The balance of Rs 9,681 crore was from the wholly owned microfinance subsidiary. In total, the group serves 4.6 million customers. IIFL Finance is listed on the stock exchange, while its subsidiaries are not.
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