LIC Housing to double lending to developers in FY12-13

“We are targeting a 100% growth under loans to developers this year,” LICHF chief executive VK Sharma told PTI after the announcement of its annual results

Mumbai: After keeping away from lending to realty developers for over a year following the bribes-for-loans scam, LIC Housing Finance (LICHF) plans to push up on the segment and is targeting to double disbursals in the high-margin area in the current fiscal, reports PTI.

“We are targeting a 100% growth under loans to developers this year,” LICHF chief executive VK Sharma told PTI after the announcement of its annual results.

During FY11-12, LICHF’s disbursals to developers fell to Rs910 crore as against Rs2,400 crore in the previous year.

Even though loans to individual borrowers grew 18% during the fiscal, the slowdown in project loans was cited as one of the reasons for a drop in net interest margin to 2.44% versus the year-ago period's 3.08%.

Mr Sharma said at its peak, loans to projects constituted for 12% of the company's books which has now come down to above 5%.

“We plan to take it to over 8% through the jump in disbursals to project loans,” said Mr Sharma.

According to Mr Sharma, loans to individuals earn the company an interest of around 11%to 12%, while the same to corporates can get it over 15%.

Courtesy a jump in lending to corporates, and softening of interest rates, Mr Sharma said LICHF is hopeful that its NIM (net interest margin) will regain lost ground and climb up to over 3% during the quarters ahead.

On the individual loan side, Mr Sharma said he expects a 20% increase in spite of fears of a slowdown in activity, and piling up of inventories as a consequence, by focusing on Tier-II and III cities.

Speaking about other forward looking plans, Mr Sharma said the company plans to undertake an institutional share sale by June and will decide the exact timing depending on market conditions.

LICHF has got shareholder approval to sell 4.6 crore shares through the QIP (qualified institutional placement) issue, he said.

At 11:19 am, LIC Housing Finance was trading marginally higher at Rs257.30 per share on the Bombay Stock Exchange, while the benchmark Sensex was marginally higher at 17,343.

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COMMENTS

Aurobindo Banerjee

5 years ago

While investment decisions must be the prerogatives of the companies themselves, PSUs must not lose sight of the fact that the real stakeholders in these outfits are the taxpaying public of the country. This being the fact, though conspicuous by its being negated by the management and the administrative ministries, it would be necessary to incorporate in the terms of loan agreements certain stipulations requiring the builders (who undoubtedly enjoy enormous political support of the political parties, both right and left) to duly take care of the end users of their productys. especially if they happen to be the common public and the end product is to be dwelling units for the ordinary public. In fact, the LICHF must be advised by the MoF to ensure that the end users must be treated as stakeholders in the projects being financed by the company so as to protect their rights vis-a-vis the RTI Act and also the PCA.

Siyaram's to invest Rs 160cr for capacity expansion in FY12-13

We have decided to expand our fabrics and garments manufacturing capacity. For this, we plan to spend Rs160 crore this fiscal,” Siyaram's vice-chairman and managing director Ramesh Poddar told PTI

Mumbai: Siyaram’s, a leading producer of blended fabrics, plans to invest Rs160 crore in FY12-13 to enhance its fabrics and garments manufacturing capacity, reports PTI.

“The demand for branded products is always growing. To meet this demand, we have decided to expand our fabrics and garments manufacturing capacity. For this, we plan to spend Rs160 crore this fiscal,” Siyaram's vice-chairman and managing director Ramesh Poddar told PTI.

The city-based company plans to increase the fabrics capacity by about 10 lakh metres a month. “The expansion work will start by August-September,” he said, adding, “it will be funded through internal accruals and loans.”

Siyaram’s, which enjoys a market share of 20% in the Rs6,000-crore organised market, currently manufactures 550 lakh metres of fabric every year and will increase the capacity by 125 lakh metres, he said.

It also makes 2.5 lakh pieces of garments every month and plans to increase this to 3.2 lakh pieces, he added.

The firm operates four plants at Tarapur near Mumbai for weaving and yarn dyeing, two at Daman for garments and one at Silvasa for weaving.

The company, that owns brands like J Hampstead, Oxemberg, Siyaram MSD, plans to open 40 stores during the fiscal, mostly through the franchise route.

“We have 100 exclusive shops and we will add another 30-40 stores. Since it will be mostly through franchise, we will not have to invest much. Our share may be somewhere around Rs3 crore,” Mr Poddar said.

The BSE-listed company is expecting a growth of at least 15% in net sales during the fiscal. “Last year we clocked a net turnover of Rs900 crore and expect to touch around Rs1,100 crore this fiscal. Gross sale should be 15% more than the net sales,” he said.

He said the revenue contribution from garments will be close to Rs200 crore. Siyaram's also expects its exports, which is primarily in West Asia, to increase to Rs75 crore this year from Rs50 crore.

At 11:17 am Siyaram’s shares were trading at Rs260 per share, up 2.30%, on the Bombay Stock Exchange, while the benchmark Sensex was marginally higher at 17,340.

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Tata Elxsi to increase headcount at Bangalore lab

“We have 330 people working in Bangalore and we are in the process of hiring more,” Tata Elxsi head, marketing & sales, Asia, Kunaal Saigal told PTI

Mumbai: Tata Elxsi, a technology design company and part of the Tata Group, is in the process of expanding head count at its visual computing lab in Bangalore backed by a strong order book, reports PTI quoting a senior company executive.

“We have 330 people working in Bangalore and we are in the process of hiring more,” Tata Elxsi head, marketing & sales, Asia, Kunaal Saigal told PTI.

The company provides engineering software and design services. It has four labs—at Andheri and Bandra in Mumbai, as well as Bangalore and Santa Monica in Los Angeles—which develop visual effects, 3D stereoscopy and animation for TV commercials, TV serials, movies, custom-made content and computer games.

“Yash Raj Films (YRF) is our key client. We recently bagged a deal to do visual effects for its forthcoming movie called “Ek Tha Tiger”. We will also do visual animation for “Roadside Romeo”, a YRF-Walt Disney co-production, as well as UTV’s “Arjun, The Warrior Prince”. “Dhoom 3” and “Bhag Milkha Bhag” are the other movie projects we will be doing,” he said.

He declined to disclose the value of these deals, or the respective contributions to the company's revenues from its divisions like embedded product design, industrial design, as well as systems integration, besides visual computing labs.

The company has also become a preferred partner of Microsoft’s computer games.

“We are a preferred partner for Microsoft’s Connect gaming platform. We have already worked on games like “Disneyland Adventure” as well as “Rush”, which we delivered recently,” Mr Saigal said.

At 11:15 a.m. Tata Elxsi shares were trading at Rs206.05 per share, up 1%, on the Bombay Stock Exchange, while the benchmark Sensex was marginally higher at 17,338.

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