Disbursements by mortgage lender LIC Housing Finance will see a rise in the September quarter as challenges relating to the rejig of its offices and technological upgrades have now been addressed, managing director and chief executive officer Tribhuwan Adhikari said on Monday.
“In the September quarter, we are aiming for and are pretty sure that this declining trend in disbursements that have been witnessed in over three quarters will be taken care of,” Adhikari said.
The housing financier’s disbursements fell to Rs 10,856 crore in the June quarter from Rs 15,202 crore a year ago. Similarly, they were lower at Rs 16,027 crore in the March quarter from Rs 19,315 crore a year ago.
“Disbursements have been down by around 28% from quarter-to-quarter. The restructuring (of offices) that we undertook entailed a lot of movement of manpower across various places. This impacted our business.
“At the same time, we changed our software platform completely. While we were hit by the impact these upgrades in April and May, we were back on track from June onwards,” he added.
The company expects disbursements to grow at 15% in the current fiscal.
The home loan company has opened 44 additional cluster offices in order to decentralise various tasks and improve turnaround time for customers. It has also opened 50 new area offices in tier-2 and tier-3 towns to increase geographical reach. In addition to the corporate office in Mumbai, it has 24 back offices, 44 cluster offices and 314 area offices.
LIC Housing Finance has taken Housing Development Finance Corporation’s spot as the largest housing finance company in India following the latter’s merger with HDFC Bank.
The company’s outstanding loan portfolio rose 8% y-o-y to Rs 2.8 trillion as on June 30. While the individual home loan portfolio grew 10% y-o-y, project finance de-grew 9% y-o-y as a part of the company’s drive to improve asset quality.
Nevertheless, the company is focussing on resuming its project finance operations this year even as it will be “choosy” in sanctioning loans.
“We are already in the process. We have a huge pipeline of project applications in place. We have sanctioned quite a few although disbursements have not taken off,” he said. The project finance portfolio is expected to grow at 10-12% y-o-y in the current financial year.
Apart from this, the company is focussing on kick-starting lease rental discounting and loans to mid-sized builders. These products will likely by launched by September end or in early October.
Broadly, Adhikari feels that the traction for retail housing, semi-luxury and luxury housing, and office spaces will drive overall housing demand going ahead.