Godrej group launches NBFC 24 years after getting licence; Targets Rs 30,000-crore balance sheet by 2026

The Godrej Group, which has interests in consumer goods, agri, real estate and retail, is the newest conglomerate to enter the financial services space.

Godrej Capital will need Rs 5,000 crore of capital by 2026. (File)
Godrej Capital will need Rs 5,000 crore of capital by 2026. (File)

Godrej Industries on Monday announced the launch of its financial services subsidiary Godrej Capital, which will be the holding company for mortgage lender Godrej Housing Finance and non-banking finance company (NBFC) Godrej Finance. Godrej Capital intends to grow its balance sheet to Rs 30,000 crore in 2026 from Rs 1,800 crore at present.

The Godrej Group, which has interests in consumer goods, agri, real estate and retail, is the newest conglomerate to enter the financial services space. While Godrej Housing Finance was launched in November 2020, the group is only now going for an NBFC launch using a licence it has held since 1998.

Pirojsha Godrej, chairman, Godrej Capital, said that with the benefit of hindsight, the group should have moved to the financial services opportunity more quickly. “Over the last few years, we have been more focused, as a group, on streamlining our presence and making sure that the business spaces we are in, we have leadership or a very strong position,” Godrej said.

He added: “We now feel ready and we have the appetite to invest. We believe there is clear logic and path in creating a strong position in this space. And that’s why we are now investing in it.”

In order to achieve its growth target, Godrej Capital will need Rs 5,000 crore of capital by 2026, which will come from within the Group. By the end of April 2022, Rs 1,500 crore of this investment will have already been made, Godrej said.

The company will continue to maintain its focus on the growth of secured loans, consisting of home loans and loans against property (LAP). In addition, it will also foray into cashflow-based lending to small businesses. It will be headed by Manish Shah, currently MD & CEO of Godrej Housing Finance.

Godrej Capital currently has a presence across Mumbai, Bengaluru, Delhi NCR, Ahmedabad and Pune, and will soon be operational in six new cities – Jaipur, Chandigarh, Hyderabad, Chennai, Indore and Surat. It plans to grow its team by 50% to approximately 500 people in FY23.

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