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Hinduja Leyland Finance (HLFL), which is set to raise ₹500 crore through an IPO, hopes to maintain a healthy double-digit growth in the medium term.
This confidence stems from bright growth prospects across segments, a strong physical presence, and a differentiated business strategy, according to the company’s CEO Sachin Pillai.
“We filed our DRHP (draft red herring prospectus) in June this year and secured approval last Friday. We started off the roadshows this week. We will go to Singapore and Hong Kong next week and, a week later, we will have roadshows in the UK and US,” Pillai told BusinessLine .
The IPO proceeds will augment HLFL’s capital base and support its growth plans over the next two years.
Everstone’s share-sale
The non-banking finance company (NBFC) will raise ₹500 crore via a fresh issue, besides an offer-for-sale of about 3.1 crore shares by existing investors including Everstone Capital, which has a 7 per cent stake in the company.
Hinduja Group companies hold about 93 per cent stake in HLFL, of which Ashok Leyland has about 62 per cent.
While the stake of Hinduja Group entities will come down post IPO, the promoters will continue to hold a majority controlling stake, with Ashok Leyland being the primary shareholder.
In the past two years, HLFL has raised about ₹700 crore, of which Ashok Leyland’s infusion was about ₹410 crore.
The NBFC had planned to raise ₹600 crore last year, but deferred the IPO plan citing market conditions.
The company has been growing its assets under management (AUM) at more than 40 per cent, driven by healthy disbursements across segments such as vehicle finance, construction equipment and loan against property.
“We are well on our path to leverage the growth opportunities in our business segments. Going forward, we hope to maintain a healthy growth,” said Pillai.
Nationwide network
The company’s network covers 1,515 locations across several States and Union Territories.
As of March 31, 2018, its AUM was ₹19,263 crore, with vehicle loans accounting for about 77 per cent of the portfolio, making it one of the biggest players in the vehicle finance space.
The remaining portfolio consisted of loans against property (13 per cent) and portfolio buyouts.
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