Home First Finance Company India Limited IPO
About Home First Finance
(i) Founded in the year 2010, Home First Finance is the technology-driven home finance company that typically targets first time home buyers in the low and middle-income groups. 91% of the total loan book is given to purchase or construct a house.
(ii) Home First Finance targets salaried and self-employed customers and these two comprises of 73% and 25% of the loan book, respectively. As on 30.09.2020, it has 44796 active loan accounts with 3730 Cr of Gross loan book. The average ticket size of the loan is 10.2 Lakh and with an average loan-to-value on Gross Loan Assets of 48.8%, as of September 30, 2020.
(iii) They also offer other types of loans comprising loans against property, developer finance loans, and loans for the purchase of commercial property; however, it comprised only 4.7%, 2.8%, and 1.1% of total Gross Loan Assets.
As on 30.09.2020, Home First Finance has a network of 70 branches covering over 60 districts in 11 states and a union territory in India, with a significant presence in urbanized regions in the states of Gujarat, Maharashtra, Karnataka, and Tamil Nadu.
The company over the years has expanded into those territories where there is a demand for home buyers. Before setting up a new branch in a district, they conduct an in-depth study of the micro markets around the branch to assess the potential demand for housing finance and target regions with increasing urbanization and housing demand.
Underwriting and Risk Management
The company has leveraged technology to process the loan and to manage the risk. They have developed a paperless process of the loan disbursement and they have a dedicated sales team who goes to buyer home and ensure minimal disruption to customer daily routine while disbursement of the loans.
For underwriting, Home First Finance is utilizing proprietary machine learning customer scoring models for a centralized credit underwriting process, which has led to consistent and accurate credit evaluation with quick turnaround time.
They digitally capture over 100 data points of a customer in addition to credit bureau data, observations of the front end teams, and feedback from the underwriting and management teams. They capture and store all the data on a cloud services platform. They have entered into arrangements with third-party service providers through whom they obtain additional information such as fraud-related data, banking, investment and taxation related data, and vehicle ownership of customers, which enables Home First Finance with underwriting and to identify areas of concern and take quick and accurate decisions.
To disburse loans one needs money. Let us see how Home First Finance has borrowed money over the years.
As on 30.09.2020, the company has outstanding borrowing of 2635 Cr. They mostly borrow from the private banks, public banks, NHB (National Housing Board), a subsidiary of RBI, and through assignment transactions. 37% of borrowing is from NHB.
Credit rating is the most important parameter which all analysts should look carefully at. The highest credit rating means the company is serving its principal and interest on time. The highest credit rating is not only good for the lending institutions but also for shareholders of the company.
As on 30.09.2019, Home First Finance currently has an ‘A+ (stable) rating from ICRA Limited.
Founders and Investors
The Company was founded by Jaithirth Rao, P. S. Jayakumar, and Manoj Viswanathan in August 2010. The company is managed by professionals and the Promoters are True North Fund V LLP and Aether (Mauritius) Limited. Further, Bessemer has also invested in the Company.
Marketing Video of Home First Home Finance
Objects of the Home First Finance Company India Limited IPO:
Home First Finance Company India Limited IPO Details:
|Open Date:||Jan 21 2021|
|Close Date:||Jan 25 2021|
|Face Value:||₹ 10 Per Equity Share|
|Issue Type:||Book Building|
|Issue Size:||1152 Cr.|
|Lot Size:||28 Shares|
|Issue Price:||₹ 517-518 Per Equity Share|
|Listing Date:||Feb 01 2021|
Promoters And Management:
Financials of Home First Finance Company India Limited IPO:
|Particulars (in Crores)||6MFY2021||2020||2019||2018|
|Key Metrics of HFC|
Comparison With Peers:
Recommendation on Home First Finance Company India Limited IPO:
Lead Manager of Home First Finance Company India Limited IPO:
Registrar of Home First Finance Company India Limited IPO:
Discussion on Home First Finance Company India Limited IPO:
HFFC gmp ? @Umesh sir and Eagleye
Alloted 1 out of 3 lots applied from 2 PAN. What’s the current GMP? Should we hold it for long term or sell for listing gain?
Very god company. It is a good portfolio stock. Best formula is sell 50% on listing and keep rest 50% with stop loss of 450.
Applied 1+1 , Allotted 0+0, in two PAN.
Home First Finance IPO allotment now available on KPRISM App .
Looks good to me for apply.
Should we apply
GMP is rs 1
Still we should apply
GMP is Rs.170 in Home First Finance
Warburg Pincus has bought stakes in the company at Rs. 336 per share in Oct-2020.
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