DHFL sees 20% loan growth in FY16 on affordable housing demand

Mortgage lender DHFL on Tuesday said it expects 20% growth in credit pick up in the current fiscal because of robust demand for affordable housing.

"We will be growing at 18-20% in terms of loans in the current fiscal," DHFL CEO Harshil Mehta said. The growth is coming mostly from Tier II and Tier III cities where ticket size is low, he said.

Loan disbursement and sanction of the housing finance firm was Rs 5,014 crore and Rs 7,668 crore respectively for the quarter ended September 30, 2015 - an increase of 17.75% and 25.18% over the year-ago period.

The company's assets under management (AUM) grew by 27.31% year-on-year, reaching close to over Rs 63,000 crore from over Rs 50,000 crore as on September 30, 2014.

With regard to resource mobilisation, Mehta said, the company is increasing focus on fixed deposits (FDs) as it helps in lowering overall cost of funds. Currently, FDs are 9% of the total borrowing and is expected to increase to 15-16% in the next few years.

The company has mobilised close to Rs 4,347 crore from FDs as of September 30.

Talking about the North India market, Mehta said the company is expecting a steady growth in its loan book size in the this market, especially Delhi in the next three years.

The company is expecting 25% surge in home loan disbursement in the region with the implementation of the 'Housing for All by 2022' and Smart City projects, he said.

Delhi market contributes 12% to the DHFL's total loan book size.