LIC Housing Finance (LIC HFL) recently said it has begun the process of raising funds through QIPs (Qualified Institutional Placements) this fiscal - 2012-13, via issue of 4.06 crore shares valued currently at about Rs 1,100 Crore.
Mr. V K Sharma, Director & Chief Executive, LIC HFL said, ''The Board of Directors approved a proposal to raise funds through QIP at the AGM (Annual General Body) meeting in March this year (2012). We have got a one year time period till March 2013. Right now, the process is on. We will take a decision in 2 to 3 months (on raising capital)", he said after inaugurating the 15th edition of "Ungal Illam", it's flagship exhibition in Chennai at July 13, 2012.
Mr. Sharma also said, ''The Board had given nod to liquidate 4.06 crore shares (nearly 2%). "The value of capital to be raised will be price of each share. Overall dilution through this proposal would be around 2%. LIC HFL's Capital Adequacy Ratio (CAR) is 14%. Last year, when RBI changed norms for NBFCs and others, we were under the impression that our regulator (NHB) would also change it. But they did not. They have issued clearances".
"The company was in very strong position in financially. The capital raising proposal would bring "value" to shareholders and to the company itself. It will be useful for the business purposes. We have started the process. It is good to raise capital, particularly when there is a high interest rate (scenario in the market). Ultimately, every year we are growing above 20%. Total assets managed by LICHF are about Rs 60,000 crore and last year total loan disbursement was Rs. 20,000 crore. This year it is looking at Rs. 22,000 crore with a growth of over 20%.The commercial business, Indian real estate projects are witnessing a "clear cut slowdown". 95% of total business constitutes retail lending and the balance real estate developers" " Mr. Sharma added
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