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Tata Capital Housing Finance Ltd (TCHFL) plans to raise up to INR 3,500 crore through non-convertible debentures (NCDs) to fuel business growth. As of March 2024, TCHFL's loan book reached INR 51,402 crore, marking a 39% year-on-year growth. The company raised INR 5,429 crore via secured NCDs in FY24, with a debt-equity ratio of 7.27%. TCHFL's retail finance portfolio, including home loans and loans against property, grew to INR 42,391 crore, while its construction finance portfolio increased to INR 9,011 crore. The company's enhanced regulatory oversight stems from its substantial loan book exceeding INR 50,000 crore.
Tata Capital Housing Finance Ltd (TCHFL), the mortgage lending subsidiary of the Tata Group, is set to raise up to INR 3,500 crore through non-convertible debentures (NCDs) to fuel its business expansion. This strategic move aligns with the company's broader efforts to enhance its financial position and support its growing loan portfolio. Advertisement
As of March 31, 2024, TCHFL's loan book stood at an impressive INR 51,402 crore, reflecting a strong 39% year-on-year growth from INR 36,917 crore in the previous year. The significant increase in the loan book places TCHFL within the "upper layer" of non-banking financial companies (NBFCs) under the banking regulator's scale-based regulation framework. This categorisation subjects TCHFL to enhanced regulatory oversight, which may include additional compliance requirements and the potential for listing its shares on stock exchanges.
TCHFL has adopted a diversified funding strategy, leveraging a combination of NCDs, bank borrowings, and commercial paper. In FY24, the company successfully raised INR 5,429 crore through secured NCDs via private placement, contributing to its overall financial stability. The company's aggregate debt stood at INR 47,271 crore as of March 31, 2024, with INR 14,302 crore due for repayment within one year. The debt-equity ratio was 7.27% at the end of FY24, indicating a well-balanced approach to managing its liabilities.
In terms of lending activities, TCHFL disbursed loans totalling INR 26,341 crore in FY24, up from INR 17,338 crore in FY23. The retail finance (RF) loan portfolio, which includes home loans and loans against property, grew substantially to INR 42,391 crore from INR 30,580 crore in the previous year, highlighting the company's strong presence in the retail lending segment.
TCHFL also continues to expand its construction finance (CF) portfolio, providing financing to real estate developers in select Tier-I and Tier-II towns. The CF portfolio grew to INR 9,011 crore by the end of FY24, up from INR 6,337 crore the previous year. This growth in CF has been a key contributor to the company's profitability, bolstered by strong net interest margins and increased fee income driven by higher volumes and a growing client base.
In conclusion, Tata Capital Housing Finance Ltd (TCHFL) is strategically positioning itself for substantial growth by planning to raise up to INR 3,500 crore through non-convertible debentures (NCDs). This move supports its strong expansion efforts, as evidenced by its impressive 39% year-on-year growth in the loan book, which now exceeds INR 51,000 crore. With a strong retail finance portfolio and increasing investments in construction finance, TCHFL is enhancing its market presence and financial stability. The company's diversified funding strategy and sound debt management, reflected in a manageable debt-equity ratio, further underpin its solid growth trajectory. This strategic expansion and financial fortitude highlight TCHFL's commitment to strengthening its position in the housing finance sector.
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