Godrej Capital will likely launch affordable housing loans in 2024-25 (April-March), says Managing Director and Chief Executive Officer Manish Shah. “We are still trying to get a sense of what is the best way to do the affordable housing business. We are currently in the study phase and will look to launch the business next financial year,” he said.
He added that if the company can build a Rs 5,000 crore book in affordable housing segment in the next 4-6 years, it will consider that a successful venture.
As of now, Godrej Capital caters to the affordable housing segment through co-lending partnerships with smaller non-bank lenders. It plans to increase its co-lending partners to 10 from four currently.
The company expects the co-lending book to touch Rs 500 crore by March 2025. It expects to make co-lending into a Rs 1,000 crore assets under management in the following two-to-three years after that.
Currently, the company’s assets under management stand at around Rs 7,500 crore. The loan book is split equally between small and medium-sized enterprises (SME) loans and home loans.
The SME loan portfolio stands at Rs 3,500 crore of which, a majority are secured loans.
The company expects to increase its SME loan portfolio to Rs 5,000 crore by March 31. Unsecured business loans are expected to increase to Rs 1,000 crore from Rs 300 crore.
Overall, the company expects to hit an assets under management of Rs 30,000 crore by the end of 2025-26.
As far as the broader strategy is concerned, Shah feels that the company is still three-to-five years away from an initial public offering.
But, the company would require an additional equity of around Rs. 1500 crore to achieve its assets under management target.
Earlier, Godrej Industries had committed an equity infusion of around Rs 2,000 crore by 2023-24. Of this, Rs 950 crore was infused in 2022-23.