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Manappuram Finance Committee Approves Rs 8,000 Crore Fundraising Plan for FY24

Manappuram Finance board approves issuance of up to Rs 8,000 crore NCDs in FY24.

The board of Kerala-based gold lending giant Manappuram Finance on Friday approved the company’s FY24 fundraising plan, which includes through tranches or tranches of private placement or public offering.

In a presentation to the stock exchange, Manappuram Finance said the board or committee would decide whether the shares to be issued will be listed on the stock exchange. In contrast, the instrument’s tenure will be agreed upon at allocation time.

The company’s strategy to diversify into other industries has been picking up pace, and the rebalancing is already reflected in the December 2022 quarter results. The company said it would continue implementing its policy of becoming a diversified NBFC. The housing finance business has been focused on a call location-based model with parallel branches, specialising in batch housing loans. Due to the huge potential, Manappuram Finance has also decided to venture into niche areas such as finance, healthcare professionals and small hospitals.

In an interaction with FE’s release of its third-quarter results, Manappuram Finance MD & CEO Nandakumar VP recently said that consolidated gold loan AUM fell slightly by 3% but is not overly concerned as this is the rebuilding of the Covid-19 crisis. The stage, after all, realms, cast shadows.

“In our experience, demand is steadily coming back up, and once it gets back to pre-COVID levels, especially at the base of the pyramid, we’re going full speed ahead. As you can observe, gold prices rose last quarter, which also worked in our favour. In the long run, gold loans will continue to be attractive, and we expect gold assets under management to grow,” he had said.

The company’s management told analysts last month that it was not ignoring its gold lending business but was strengthening its gold lending and non-gold businesses. It has been said the results will be apparent in the coming quarters. The company expects gold lending to grow along with other businesses, with improved margins across all sectors starting in the fourth quarter.

Manappuram Finance’s gold loan AUM stood at Rs 18,614 crore in Q3FY23, down from Q3 last year but essentially flat QoQ. Overall, consolidated AUM stood at Rs 31,883 crore in the third quarter, up 4.9% from a year earlier.

The company reported a 50.76% rise in consolidated net profit at Rs 393.49 crore in Q3FY23, compared to Rs 261.01 crore in the same period last year. Operating income stood at Rs 1,714.12 crore, up 15.47% from Rs 1,484.45 crore.

The company’s microfinance subsidiary Asirvad posted an AUM of Rs 8,653 crore, up 22% year-on-year, and a third-quarter profit of Rs 70.5 crore.

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