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JM Financial Home Loans Ltd (JM Financial) and Indostar Capital Finance Ltd (Indostar) on Monday announced that they are engaged in preliminary discussions to explore potential strategic options including the combination and listing of the retail mortgage portfolio of JM Financial and the home finance business of Indostar Home Finance Pvt Ltd. This includes other mortgage-backed business of Indostar.
JM Financial, in a regulatory filing, said it has a long-term strategic interest in the home loan and such mortgage-backed businesses and looks forward to scaling these businesses to the next phase of its growth.
“The discussions are currently at a preliminary stage and non-binding in nature and any transaction concerning JM Financial and Indostar will be subject to satisfactory due diligence, negotiation of commercial terms, execution of definitive agreements, and receipt of all relevant regulatory and other approvals,” per the filing.
JM Financial Home Loans Ltd (JMFHLL), a part of the JM Financial group, received the registration in November 2017 and is focusing on (i) affordable housing finance and (ii) smaller ticket loan against property.
As of December 2022, JMFHLL has expanded to 78 branches across the states of Maharashtra, Gujarat, Rajasthan, Tamil Nadu, Telangana, Karnataka, Andhra Pradesh, Chattisgarh and Madhya Pradesh with a loan book of ₹1,181 crore and AUM of ₹1,272 crore.
It has an employee base of 779, an average ticket size of ₹12 lakhs and loan to value of 55 per cent as of December 2022.
IndoStar Home Finance Private Limited is a wholly-owned subsidiary of IndoStar. It provides affordable home financing solutions to self-employed and salaried customers. The HFC had AUM of ₹1,526 crore as of December-end 2022. It disbursed home loans aggregating ₹107 crore in Q3FY23.
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