Sequoia-backed Dewan Housing Finance To Raise $100M Through QIP

By Anil Das

  • 23 Feb 2012

Dewan Housing Finance Corporation Ltd, a private sector housing finance player backed by Caledonia Investment and Sequoia Capital India, has received the board’s nod to raise Rs 500 crore ($100 million) via qualified institutions placement, the company has disclosed in a statement to the Bombay Stock Exchange.

The QIP will come with a floor price of Rs 255.48 per share.

At 1:30 pm, shares of Dewan Housing Finance were trading at Rs 258.90 a unit on the BSE, up 0.54 per cent from the previous close.

At the floor price, the company would issue 19.3 million shares, translating into around 9 per cent post-issue equity dilution. Sequoia Capital, through an investment entity, owned 4.5 per cent stake in the company as of December 31, 2011. This would now dilute to around 3.8 per cent. The Singapore government is also among the investors in the company.

For Q3 FY12, Dewan Housing reported net interest income (NII) of Rs 183 crore, up 48 per cent year-on-year. The loan portfolio was up 50 per cent YoY during the quarter. Housing loans sanctioned during the quarter ended December 31, 2011, amounted to Rs 3,189.53 crore – an increase of 44 per cent over the year-ago period. Disbursements during the quarter amounted to Rs 2,279.78 crore, posting 49 per cent increase over Q3 FY11.

“Loan growth at 50 per cent YoY re-affirms our positive stance on demand potential in tier II and smaller cities. Over the past two decades, Dewan Housing has gained a dominant position in mortgage needs of customers in the LMI segment,” a January report by Emkay Global stated.

Incorporated in 1984, Dewan Housing Finance provides housing finance, and insurance and property services. Last month, the companysaid that it would expand beyond real estate financing and make foray into education lending business. Dewan Housing Finance said in a filing that it would buy “equity stake of an unlisted non-banking financial company (NBFC), registered with the Reserve Bank of India. The company proposes to foray into the education sector in order to provide a portfolio of education loan and allied services.”