Indiabulls Housing Finance targets 15% growth in FY25 asset base

Gurugram-based Indiabulls Housing Finance is targeting a growth of around 15% in its asset under management (AUM) in the financial year 2025.

"There is renewed focus on ensuring that the disbursals around retail business, which is home loans and retail loans against property given to small business owners, scale up; we are hopeful that we will be able to start growing our AUM," said Gagan Banga, the company's Vice Chairman and Managing Director.

The company's AUM is currently at around ₹67,000 crore.

Banga is confident of achieving return on assets (RoA) of more than 3% by the end of the financial year 2026 and return on equity (RoE) of over 15% by financial year 2027.

Speaking to CNBC-TV18, Banga said, “The RoA had declined from being north of 3% to a low of about 1.2%. It has inched back up to 1.6%. We expect that every six months, we should be able to grow the return on equity (RoE) by about 20 basis points, which should take RoA to north of 3% by fiscal year 2026.”

In the third quarter of FY24, disbursements declined 21% year-on-year (YoY). Net Interest Income (NII) also slipped 28% YoY to ₹350 crore.

Moody’s recently upgraded the ratings for Indiabulls Housing Finance.

Moody’s attributed this upgrade partly to the rights issue in February 2024, which is anticipated to bolster the Total Capital to Total Managed Assets (TCE/TMA) ratio and the Capital to Risk (Weighted) Assets Ratio (CRAR).

"The rating upgrade is going to more be impactful on any future international issuances we do. We have, in the past, raised almost around 25,000 crores internationally in dollar denominated loans bonds etc. We will continue to evaluate that market and based on opportunity see if we can raise some liquidity there as well," Banga said.

Indiabulls has a market capitalisation of ₹13,218.67crore. The stock has gained 81% over the last year.