Centrum Group's affordable housing finance arm CHFL has entered an agreement to acquire the housing finance business of Chennai-based National Trust Housing Finance Limited (NATRUST) for Rs 112 crore.
The agreement enabling CHFL to acquire the housing finance business along with the loan portfolio, branches and employees, will propel CHFL’s assets under management to over Rs. 1,000 crores. NATRUST offers affordable housing finance in 17 locations across four states in South India, and has a loan book of over Rs 300 crores.
CHFL was launched in 2017 to offer home loans, loans against property, plot purchase & construction and home extension loans, to customers from low and middle income groups across 10 states in India. The acquisition will help CHFL expand geographical coverage, add origination capacities to augment organic growth.
Commenting on the acquisition, Jaspal Bindra, Executive Chairman, Centrum Group said, “There is a growing demand for affordable housing in India, beyond metros and tier 1 cities too. Small cities are witnessing a higher demand driven by greater urbanisation, digitisation, b0etter infrastructure and connectivity."
He added that, "schemes like the PMAY have provided a strong impetus to affordable housing and we believe this sector has immense growth potential. NATRUST is a reputed housing finance company with a high quality loan portfolio and a competent team. The acquisition consolidates our presence in South India, and will help us further increase our penetration across our chosen geographies.”
Commenting on the sale, Mr.S.Rajagopal, Chairman, National Trust Housing Finance Limited, said “Natrust has since its inception in the mid ‘90s, been a pure play housing finance company, focused on the affordable segment in Southern India. Natrust has consistently been recognised for being a ‘Great Place to Work’, and has featured amongst the 30 top firms to work for in the BFSI segment. Natrust’s niche focus in southern geographies together with its fine talent, complements Centrum’s focus across other markets very well. We wish Centrum all the best in its ambitious plans for the housing finance business and beyond”
During the last few years, CHFL has significantly expanded its branch network, built a strong underwriting team, and established fresh borrowing relationships with banks and financial institutions. In February 2020, a fund managed by Morgan Stanley PE Asia, invested almost Rs 190 crores to acquire a minority stake in CHFL.
