Home First Finance Company gets Sebi approval to raise Rs 1,500 cr via IPO

Mortgage financier Home First Finance company on Tuesday said it has received approval from market regulator Securities and Exchange Board of India (Sebi) to raise Rs 1,500 crore through initial public offering (IPO).

The IPO consists of fresh issue of up to Rs 400 crore and an offer for sale (OFS) of up to Rs 1,100 crore by selling shareholders, the company said in a release.

The promoters and investors who are selling their stake through OFS route are True North Fund V LLP, Aether (Mauritius), Bessemer India Capital Holdings II Ltd, P S Jayakumar, Manoj Vishwanathan and Bhaskar Chaudhry.

The company had filed draft red herring prospectus (DRHP) with Sebi on November 28, 2019. The equity shares will be listed on National Stock Exchange (NSE) and BSE. The company intends to utilise the net proceeds towards augmenting its capital base to meet its future capital requirements, arising out of growth of its business and assets and to receive the benefits of listing of the equity shares on the stock exchanges, according to the release.

The affordable housing finance-focussed company may consider a pre-IPO placement of up to Rs 160 crore in consultation with the book running lead managers (BRLMs), as per the DRHP.

If the pre-IPO placement is undertaken, the amount will be reduced from the fresh issue, the company said.

The company was founded by P S Jayakumar, former managing director and CEO of Bank of Baroda and Jaithirth Rao, ex chairman and managing director of Mphasis, and commenced operations in 2010.

The home financier's gross loan assets crossed Rs 2,443.5 crore as on March 2019.

It serves over 30,000 customers, most of them falling under Pradhan Mantri Awas Yojana (PMAY), across urbanised regions of Gujarat, Maharashtra, Karnataka and Tamil Nadu which accounts for 79 percent of the affordable housing market.

Its loans have an average ticket size of Rs 10.4 lakh mainly accounting for purchase and construction of homes.