The rating also factors in the highly successful QIP and Rights Issue undertaken by PEL during the past financial year of ~INR 7,000 crore, of which INR 5,000 crore has been allocated to the financial services business.
Piramal Capital & Housing Finance Limited (‘PCHFL’) has been assigned a long term rating of ‘CARE AA+; Stable’ for its debt instruments post the scheme of amalgamation of Piramal Finance Limited (‘PFL’) and Piramal Capital Limited (‘PCL’) with PCHFL (erstwhile Piramal Housing Finance Limited). PFL was rated ‘CARE AA; Stable’ by CARE Ratings and post the amalgamation, the long term debt instruments have been assigned a rating of ‘CARE AA+; Stable’ in PCHFL. PCHFL has now become a wholly owned subsidiary of Piramal Enterprises Limited (PEL) and is the flagship entity for the Group’s financial services business.
This rating recognizes the strong performance across both real estate and non-real estate sectors over several quarters, takes into account robust risk management metrics, a stringent in-house asset management and monitoring process that has kept NPAs in check despite a strong ramp up of the lending business. The rating also reflects conscious and sustained effort to diversify the asset base even as the scale of business increased and add granularity to the loan book through a foray into retail Housing Finance, lending more towards construction finance and lease rental discounting under Real estate segment, expansion to multiple sectors by the Corporate Finance Group and focus on mid-market corporate through the Emerging Corporate Lending vertical.
The rating also factors in a highly successful QIP and Rights Issue undertaken by PEL during the past financial year of ~INR 7,000 crore, of which INR 5,000 crore has been allocated to the financial services business. On the liability side, the ratings reflect robust treasury management with low levels of leverage.
Khushru Jijina, Managing Director, Piramal Capital & Housing Finance, said “FY2018 was an eventful year for us as we made conscious and definitive strides towards an increasingly diversified and more granular portfolio. We continued to grow our real estate lending business with a foray into hospitality and an increased exposure to Lease Rental Discounting (LRD).”
He further added, “For non-real estate, the growth in our Corporate Finance Group comprised mainly of senior debt and project finance and with Emerging Corporate Lending, we set the foundation for more granular lending. Our retail housing finance vertical also established a strong footprint in a relatively short period of time.”
“We believe that with the restructuring and the recent allocation of capital, coupled with our complete suite of diversified products across wholesale and retail will prove to be a distinct competitive advantage in our journey of continued growth. This credit rating from CARE serves as a fitting validation of our efforts” he said.