Rs150 crore for Asirvad Microfinance; home finance capital to be doubled
THRISSUR: The leading gold finance company, Manappuram Finance, is in the process of boosting the capital base of its fully-owned subsidiaries – Manappuram Home Finance Ltd (MAHOFIN) and Asirvad Microfinance in a big way at a time when the NBFCs country-wide are said to be turning nervous about the headwinds from the liquidity crunch in the aftermath of the IL&FS debacle.
The flagship Manappuram Finance will be infusing Rs100 crore to the home finance company and thus double the paid up capital to Rs200 crore, whereas the other subsidiary, Asirvad Microfinance, with a current paid-up capital of Rs42.56 crore will get a much larger capital infusion to the tune of Rs150 crore.
While Asirvad reported an interest income of Rs437.25 crore for the fiscal ending March 2018, the interest earnings for the half-year period ending September end, 2018 was to the tune of Rs286.09 crore.
The home finance company, MAHOFIN, which operates in affordable housing finance business, has generated an interest income of Rs53.05 crore for the year ended March 31, 2018, whereas the interest earnings for the half year ending September end, 2018 have been at Rs31.24 crore..
“The capital infusion in both these subsidiaries is related party transactions and will be made at arms-length,” the company said in a statement.
MAHOFIN is a wholly owned subsidiary of Manappuram Finance and had assets under management (AUM) of Rs447.79 crore as on September 30, 2018, compared with Rs374.64 crore the company had as on March 31, 2018
Asirvad Microfinance, which came under the fold of Manappuram Finance through an acquisition in February 2015, operates in the micro finance space in various states.
“The capital infusion in the company will certainly pave the way for business growth of the subsidiary. Being the largest business of the group, after gold loans, microfinance has been viewed as strategically important to the company. The business is both scalable and profitable and hence will be a key growth driver for the Manappuram Finance Group,” the company said.
Having acquired 85 per cent in Asirvad Microfinance in February, 2015, Manappuram Finance went on to subsequently increase it to 92.30 per cent. The company had assets under management (AUM) of Rs2728.94 crore as on September 30, 2018, compared with Rs2437.20 crore it had as on March 31, 2018.