A wholly owned arm of Abu Dhabi Investment Authority (ADIA) has invested Rs 2,200 crore for a 20% stake in IIFL Home Finance. This is one of the largest equity investments in the affordable housing finance segment in India by a financial investor.
IIFL Home Finance, which has Rs 23,617-crore assets under management, is a wholly owned subsidiary of IIFL. The home finance arm plans to use the additional capital to continue its granular expansion strategy into new markets to address the significant and growing demand for housing loans.
The company has built a strategy of providing low-value loans efficiently by using technology for digital onboarding of customers and for credit appraisal and collection systems. “The investment recognizes IIFL Home Finance’s position as one of India’s largest providers of affordable housing loans and how well it is placed to continue to target the large, resilient housing finance market,” said IIFL Group founder Nirmal Jain. The housing finance company has a customer base of 168,000 across 16 states and 2 Union Territories with over 200 branches backed by more than 3,200 employees. The company offers small-ticket housing loans, those against property and construction finance.
“This investment aims to support the company for its next phase of growth, as it meets the significant demand in India’s large, under-served and fast-growing affordable housing finance market”, said Hamad Shahwan Aldhaheri, ED of the private equities department at ADIA.
Avendus Capital & IIFL Securities were the financial advisers to IIFL Home Finance for the transaction. ADIA is a globally diversified investment institution that deploys funds for long-term value on behalf of the Abu Dhabi government.