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IIFL Finance Shares Jump on Mega Deal Between Home Loan Firm & ADIA
A wholly-owned arm of Abu Dhabi Investment Authority (ADIA) will invest ₹ 2,200 crore for a 20 per cent stake in IIFL Home Finance.

IIFL Home Finance Strikes Mega Deal as ADIA Set to Buy 20% Stake at Rs  2,200 Crore
Image: News18

One of the leading NBFCs, IIFL Finance has bagged a mega deal on Thursday with Abu Dhabi Investment Authority (ADIA) to invest a massive 2,200 crore for the purchase of 20 stakes in the wholly-owned subsidiary IIFL Home Finance. ADIA will invest in IIFL Home Finance through its wholly-owned subsidiary.

In its statement, IIFL Finance said this would be one of the largest equity investments in the affordable housing finance segment in India by a financial investor.

IIFL Home Finance has proposed to use the additional capital to continue its granular expansion strategy into new markets to address the significant and growing demand for housing loans.

The deal completion is subject to regulatory approvals, it added.

“This investment aims to support the company for its next phase of growth, as it meets the significant demand in India’s large, under-served and fast-growing affordable housing finance market,” Hamad Shahwan Aldhaheri, Executive Director of the Private Equities Department at ADIA said.

IIFL Home Finance is a subsidiary of IIFL Finance. “The deal is subject to regulatory approvals,” the non-bank lender added.

The affordable housing finance company also said that it aims “to use the additional capital to continue its granular expansion strategy into new markets to address the significant and growing demand for housing loans.”

Nirmal Jain, Founder, IIFL Group said, “We are delighted to partner with ADIA who bring to the table long-term commitment and rich experience of supporting growing businesses. The investment recognizes IIFL Home Finance’s position as one of India’s largest providers of affordable housing loans and how well it is placed to continue to target the large, resilient housing finance market.”

Avendus Capital and IIFL Securities were the financial advisors to IIFL Home Finance for this transaction. The deal would mean looking at a greater value in IIFL Finance, which has a market cap of Rs 12,500 crore and a loan book of Rs 52,000 crore. On the other hand, with a market value of Rs 11,000 crore, IIFL Home Finance has a loan book worth Rs 24,000 crore.

IIFL Home Finance is a wholly-owned subsidiary of IIFL Finance engaged in the business of providing home loans, loans against property, and construction finance. The company has assets under management of Rs 23,617 crore as of March 31, 2022.

IIFL Finance is one of the leading retail-focused diversified NBFCs in India, engaged in the business of loans and mortgages along with its subsidiaries – IIFL Home Finance and IIFL Samasta Finance.

Stock Movement

Shares of IIFL Finance gained 10.25 percent to Rs 362.75 against the previous close of Rs 329 on BSE. The stock opened with a gain of 8.21 percent at Rs 356 today. IIFL Finance stock is trading higher than 5-day, 20-day, 50-day, 100-day, and 200-day moving averages.

In a year, the stock has gained 36 percent and risen 30 percent in 2022. A total of 81.12 lakh shares changed hands amounting to a turnover of Rs 272.94 crore on BSE. The market cap of the firm rose to Rs 13,746 crore

Shareholding Pattern

Nirmal Jain and his family have a 25 percent stake in IIFL Finance. Canadian investor Prem Watsa’s Fairfax Group and the UK’s CDC Group plc own 22.3 percent and 7.7 percent, respectively. General Atlantic, Bain Capital, and The Capital are some of the other investors in IIFL Finance.