Warburg-backed Indian mortgage provider Home First Finance plans $34m IPO

Photo: Pixabay

India’s Home First Finance Co. is seeking to raise as much as 2.5 billion rupees ($34 million) from an initial public offering in the next few weeks as the mortgage provider backed by Warburg Pincus LLC taps rising demand for housing.

The country’s first non-bank mortgage lender to sell shares in over two years will offload about a 25% stake after delaying the plans in early 2020 due to the pandemic, Chief Executive Officer Manoj Viswanathan said in an interview.

“Housing demand has come back,” he said by phone. “The repayment track record for housing loan customers is much better than other segments, which is why we are confident about growth prospects.”

The 10-year-old mortgage provider, which typically lends to low-to-middle income borrowers such as grocery shop owners and junior executives, provides loans with an average size of 1 million rupees.

Loan Resurgence

Reeling under a liquidity crisis that started in 2018, several shadow banks — which are less tightly regulated than real banks and typically provide credit to riskier businesses and individuals — scaled back their businesses as they struggled to survive.

Now, with the coronavirus pandemic prompting a resurgence in home sales, some lenders are optimistic about future loan growth. Viswanathan is aiming for an annual loan growth of 30% during the next financial year, almost double previous levels.

Private equity investor Warburg Pincus bought a 25% stake in Home First for 7 billion rupees in October. Other investors such as Singapore’s GIC Pte Ltd. owns 22% of the lender, True North 33% and Bessemer Venture Partners 11%, Viswanathan said.

Bloomberg

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Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.