“Our conversations have already begun and we have set up a few contingency lines, but we will look to go to the market in the April quarter,” said Manish Shah, managing director, Godrej Housing Finance. “Next fiscal year we will look to borrow between 500 and 1,500 crore depending on the pricing we get and how we want to look at leverage.”
The mortgage lender is looking at a mix of bank, non-convertible debentures and short-term commercial paper (CP) borrowing. It plans to have only 10-20 per cent of short-term CP money in its total funding mix.
“This is a good time to raise debt money. There is three-year money available at decent rates,” said Shah. “When we look at our lender discussions and the credit line that we have, we are quite happy to see the polarisation between the better rated and not so better rated non-banks work in our favour.”
Godrej Housing Finance is eyeing a piece of the 20 lakh crore mortgage market. The company has plans to sanction 1,000 loans by the end of March and grow the lending book to 10,000 crore in the next three years.
“In the near-term the entire loan book will be from customers of Godrej Properties and we plan to hit the larger market from April and have similar partnerships with other large developers,” said Shah.
He said the company will be completely retail focused, with a 70:30 mix between home loans and loans against property. Half of the mortgage book is expected to come from customers of Godrej Properties.
“We intend to be entirely retail focused, split across loan types, as we don’t see the risk reward in wholesale financing being meaningful, and considering that we have the benefit of hindsight we don’t have any plans to venture in that space,” said Shah.