By Tricitynews Reporter
Chandigarh
26th October:- Leading credit rating agency CRISIL has assigned its
“A+/stable” credit rating to the long term bank loan facility of Manappuram
Home Finance Private Ltd (MHF). The rating reflects managerial and financial
support received from the parent Manappuram Finance Ltd. and adequate
capitalisation.
According
to CRISIL, Manappuram Home Finance is adequately capitalised for the expected
scale of business following infusion of capital of Rs.55 crore in fiscal 2016,
taking its total paid up capital to Rs.100 crore. Additional infusions are
expected to support capital adequacy and keep the gearing at around 5 times
over the medium term. These rating strengths are partially offset by a small
scale of operations with a limited track record, a modest earnings profile, and
exposure to inherent risks relating to the affordable housing finance segment.
The
expectation of support from the parent is driven by the strategic importance of
the company to the Manappuram group in diversification of its financial product
suite. The business is scalable and is expected to grow materially over the
medium term. Manappuram Finance Ltd. holds 100% of the equity in Manappuram
Home Finance. The parent has infused growth capital and will infuse additional
capital as and when required. Furthermore, its Managing Director, V. P.
Nandakumar, along with another director, is represented on the board of the
company. CRISIL believes Manappuram Home Finance will continue to receive
strong financial and managerial support from its parent, while maintaining
adequate capitalisation, over the medium term.
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