Sundaram Home Finance on Monday announced its foray into the affordable housing segment and will focus on tier 2 and 3 towns for its expansion plans. Initially, the Chennai-based company will open 10 new branches and hire 50-75 people for this new segment by the end of this fiscal. The entry into the affordable housing space comes after its diversification into the small business loans segment in October last year.
Lakshminarayanan Duraiswamy, MD, Sundaram Home Finance, said, “This is a natural extension of what we have been doing since inception. Focusing on the retail customer segment in tier 2 & 3 towns is an integral part of our growth plans.”
As part of the expansion, Sundaram Home Finance is planning further diversification in the home finance space with the foray into the affordable housing segment and will be looking at disbursing home loans of up to Rs 35 lakh.
He said that the government’s stated intent is to focus on the smaller customers in the affordable housing space. “We believe we understand this space well and are well positioned to leverage the opportunity that this segment presents. We think that this segment has the potential to be a fast growing one for us in the long term,” he said.
On the plans for the affordable housing segment, Lakshminarayanan said the company plans to open first set of branches in Tamil Nadu and Andhra Pradesh while the hiring will be completed by March 2024.
Sundaram Home Finance registered a net profit of Rs 57 crore on disbursements of Rs 1,104 crore for Q1FY24. The company, a wholly-owned subsidiary of Sundaram Finance, is a leading player in the housing finance sector offering home loans, plot loans, home improvement & extension loans, loans against property and small business loans to traders and small shops.
In FY23, the company witnessed its asset portfolio crossing a significant milestone of Rs 11,000 crore. It had hired over 450 people in FY23 and overall, the previous fiscal was a strong growth year for the company driven by demand in tier 2 and 3 towns in the southern market.