Manappuram Finance Limited, an India-based non-banking finance company, recently signed an agreement to acquire Milestone Home Finance Company, an organization licensed to provide housing finance in India, from Jaypee Hotels, an India-based hospitality company, for an undisclosed amount. Manappuram offers financial services such as loans, money transfers and foreign-exchange services through a network of approximately 3,300 branches. With the acquisition, Manappuram will also offer housing loans. The move follows developments in the Indian housing finance segment such as the establishment of the National Housing Bank Residex (NHB Residex), a system that tracks residential property prices, and the federal government’s Credit Risk Guarantee Fund Trust for Low Income Housing, aims to facilitate access to credit for low-income households [1].
As of March 31, 2013, Manappuram reported total assets of INR 127 billion (USD 2.10 billion), return on assets (ROA) of 1.58 percent and return on equity (ROE) of 7.91 percent [2]. As of March 31, 2013, Milestone Home Finance Company reported total assets of INR 1.75 billion (USD 699 million) and income worth INR 358 million (USD 28.9 million). As of March 31, 2013, Jaypee Hotels reported total assets of INR 4,600 billion (USD 76 billion).
By Chikondano Faith Chisala, Research Associate
About Manappuram Finance Limited: Manappuram Finance Limited is an India-based non-banking financial company listed on the Bombay Stock Exchange. The company provides financial services including foreign exchange services, money transfers and loans against gold through 3,300 branches across India. Equity investors in the company include Mr V.P. Nandakumar, Sushama Nandakumar, Baring India Private Equity Fund III, Smallcap World Corporation, and Hudson Equity Holdings Limited. As of March 31, 2013, Manappuram reported total assets of INR 127 billion (USD 2.10 billion), return on assets (ROA) of 1.58 percent and a return on equity (ROE) of 7.91 percent.
Sources and Additional Resources
[1] Government of India Press Information Bureau, Press Release, “Mortgage Risk Guarantee Fund Set up to Facilitate Economically Weaker Sections and Low Income Households in Getting Credit from Banks and Housing Finance Companies,” http://pib.nic.in/newsite/PrintRelease.aspx?relid=101967
[2] Manappuram Finance Limited Annual Reports, “Annual Report_12_13,” http://www.manappuram.com/php/annualReport.php
Business Standard, “Manappuram Finance steps into housing loan segment,” http://www.business-standard.com/article/companies/manappuram-steps-into-housing-finance-114031301293_1.html
Economic Times, “Manappuram Finance acquires Milestone Home Finance Company from Jaypee Hotels,” http://articles.economictimes.indiatimes.com/2014-03-13/news/48189405_1_jaypee-hotels-manappuram-finance-limited-icici-securities
MicroCapital, February 5, 2014, “European Bank for Reconstruction and Development (EBRD) Lends $14m to Societe Generale Banka Montenegro to Support On-Lending for Housing,”https://www.microcapital.org/microcapital-brief-european-bank-for-reconstruction-and-development-ebrd-lends-14m-to-societe-generale-banka-montenegro-to-support-on-lending-for-housing/
MicroCapital, November 20, 2013, “International Finance Corporation (IFC), Government of Canada to Loan $85m to Dewan Housing Finance of India for “Green” Mortgages,”
https://www.microcapital.org/microcapital-brief-international-finance-corporation-ifc-government-of-canada-to-loan-85m-to-dewan-housing-finance-of-india-for-green-mortgages/
MicroCapital, April 29, 2010, “Sequoia Capital Sells Stake in Manappuram General Finance and Leasing Ltd of India for $70m,” https://www.microcapital.org/microcapital-brief-sequoia-capital-sells-stake-in-manappuram-general-finance-and-leasing-ltd-of-india-for-70m/
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