We’re investing $28 million in affordable housing finance in India
The 2 billion INR investment is in Aavas Financiers Limited (“Aavas”), one of India’s leading affordable housing finance companies.
Aavas is a retail focused affordable housing finance company, primarily serving low and middle- income self-employed customers to fulfill their home financing requirements. These customers, who make up a large proportion of India’s population, have limited or no access to formal banking credit due to lack of credit score or proven credit history. For the Half Year ended 30th September 2018, Aavas’ loan book stood at INR 4,759 crores with Gross NPAs at 0.57%, capital adequacy ratio of 58.8% and a healthy ROA of 3.06%. Aavas has extended nearly 75,000+ loans to its customers till September 2018 and has 186 branches spread across 108 districts, 817 tehsils in eight states as of 30th September 2018.
Sushil Kumar Agarwal, Whole Time Director & Chief Executive Officer, Aavas Financiers, said:
“It gives me immense pleasure to share that the Company was able to successfully raise this long-term source of funds, in this current challenging environment. CDC’s investment in Aavas’s Masala Bonds will further support the extension of affordable housing loans to low and middle income customers in underserved rural and semi-urban areas of India. We would like to thank all our investors for their trust and belief in the Company’s robust business model and we will continue to maintain our growth trajectory despite the industry currently facing headwinds.”
Ghanshyam Rawat, Chief Financial Officer, Aavas Financiers, said:
“CDC’s investment in Aavas will help us to grow our Affordable housing finance loan book. This successful placement of our maiden Rupee Masala Bonds issuance will enable Aavas to benchmark a long-term debt instrument in international markets and help us to mobilise additional funds through this route in the future. This investment is a testament of our business model and financial position in today’s tight liquidity and challenging environment”.
Srini Nagarajan, CDC’s Managing Director and Head of Asia, said:
“CDC’s commitment to Aavas will enable it to grow its affordable housing finance business that will help India’s low and middle income families to build their homes and improve overall economic prosperity in our markets. CDC’s long-term investment commitment to Aavas especially in the current liquidity situation demonstrates our commitment as a Development Finance Institution with long-term patient capital. CDC has been investing in India for over 30 years and we look forward to a productive long-term relationship with Aavas.”
Clare Murray, CDC Group, [email protected]