Star Housing Finance Limited, a BSE listed semi-urban and rural-focused home finance company, has maintained its growth trajectory in the retail home finance space and has resultantly reported strong business and financial performance for the quarter ending on June 30, 2024, as below:

Business Numbers: AUM increased 73.55% y-o-y to Rs. 471.41 crs. The company disbursed Rs. 61.23 crs in the quarter under review.

Income Growth: Interest income grew by 61.43 % y-o-y on the back of strong traction in disbursements. Net Interest Margin (NIM) stands at 7.04%.

Asset Quality Remains Intact: PAR (0+ days past due) stood at 3.38 %, of which GNPA stands at 1.57 % and NNPA stands at 1.12 % as of June 30, 2024.

Robust Profitability: Profit before Tax registered 87.98 % y-o-y growth.

Liability Scale Up: Star HFL has strong relationships with banks and FIs to aid the loan book growth. Current borrowings stand at Rs 335.35 crs through 6 banks and 11 FIs. The liability pipeline is robust and is planned as per the business plan for the financial year.

Strong Capital Levels: Net-worth as of Jun 30, 2024 stands at Rs. 137.77 crs. Leverage levels remain modest at 2.43x.

ESOP II scheme for eligible employees. This is the second scheme implemented by the company considering the expanded employee base and the contribution made by eligible employees to the growth of the company.

Dividend payout: Star HFL has announced a 50% increase in dividend payout from 5p to now 7.5p, per share, subject to shareholder approval in the ensuing AGM.

Lending Suite Upgraded: Star HFL has completed deployment of core lending suite for end-to-end processing of home loan applications along with receivable management support.

Ratings: Star HFL is currently rated BBB / Stable by CARE and India Ratings.

Speaking on the performance for the period, Kalpesh Dave, CEO of Star HFL, said, “Star HFL continues to scale up with focus on asset quality. We are now at the threshold of crossing Rs 500-cr AUM milestone and are well poised to take the next leap of Rs 1000-cr AUM over the next few quarters. The branch network is now diversified with multi-space across 34 locations with a staff strength of 280+ employees and targets to expand to over 50 locations in existing and newer geographies.”

“We shall continue to invest in branch expansion through the year, keeping target of Rs 50 cr steady state monthly disbursals to be achieved over the next few quarters. The technology has been augmented to complement the planned scale up. We shall continue to strengthen capitalization levels of the company in-line with growth requirements and subject to all necessary approvals and compliances,” he added.

Speaking about the prospects of retail housing finance, Dave said, “The relaunch of PMAY through PMAY-Urban 2.0 that entails allocation of Rs. 10 lakh cr with a focus to financially assist in construction of 3 crore additional houses, bodes well for first time home buyers and strengthens the tailwinds in the sector. Star HFL is well poised to leverage the benefits that may accrue post implementation of the scheme. The scale up in its existing and planned new geographies should get bolstered with this thrust of the Government and Star HFL remains fully focused to evolve as a meaningful player in low ticket retail housing finance place over the next 2-3 years.”