The board of directors of Kerala-based gold loan major Manappuram Finance on Friday approved fund-raising programme of the company for FY 24, which includes issuance of redeemable non-convertible debentures (NCDs) up to the overall limit of Rs 8,000 crore by way of private placement or public issue in one or more tranches.
The board or the committee will decide whether the proposed issue would be listed on the bourses while the tenure of the instrument will be decided at the time of allotment, Manappuram Finance said in a stock exchange dislcoure.
The company’s strategy of diversifying into other sectors has been gaining pace, and the rebalancing has already reflected in the December 2022 quarter results. The company said it will continue with the policy of becoming a well-diversified NBFC. In the housing finance business, it has focused on a model based on call location with parallel branches, and they focus on lot tickets housing loans. Manappuram Finance
In an interaction with FE post the Q3 results, VP Nandakumar, MD & CEO, Manappuram Finance had said recenlty there was a slight dip of 3% in the consolidated gold loan AUM, but are not unduly worried about it as this was the rebuilding phase after Covid-19 cast its shadow in all spheres.
“In our experience, demand is picking up steadily and once it returns to pre-Covid levels, especially at the bottom of the pyramid, we will go full steam ahead. As you would have observed, gold prices increased during the previous quarter and this will also stand us in good stead. Gold loans will continue to be attractive in the long run and we expect growth in gold AUM, going forward,” he had said.
The company management told analysts last month that it is not ignoring the gold loan segment and are strengthening both gold loan and non-gold. It had said the results will be evident in the coming quarters. The company expects the gold loan also to grow along with other businesses, and the profit also to improve from all sectors starting from Q4.
Manappuram Finance’s gold loan AUM stood at Rs 18,614 crore for Q3FY23, a decline over the Q3 of the previous year, but more or less steady sequentially. Overall, the consolidated AUM has reached Rs 31,883 crore in Q3 representing an increase of 4.9% over the year ago quarter.
The company had reported a 50.76% rise in its consolidated net profit at Rs 393.49 crore for the third quarter of FY23 as compared to Rs 261.01 crore reported in the year-ago quarter. Income from operations stood at Rs 1,714.12 crore as compared to Rs 1,484.45 crore, recording a growth of 15.47%.
The company’s microfinance subsidiary Asirvad posted an AUM of 8,653 crore showing a growth of 22% year-on-year and a profit of 70.5 crore during Q3.