Kerala-based gold loan firm Manappuram Finance has acquired Milestone Home Finance Company from Jaypee Hotels in an effort to diversify from its core business.
“The entire acquisition would cost the company R10 crore,” said VP Nandakumar, MD & CEO of Manappuram Finance.
“We are diversifying our portfolio to reduce the risk of concentrating on gold loans and housing finance fits into our business model. We plan to focus on affordable housing,” he said.
Milestone holds the licence of National Housing Bank (NHB) to provide home finance but so far had not started operations.
“The name of the company would be changed to Manappuram Housing Finance and it would be based in Chennai as the availability of talent is good there. In five years, we hope to build a portfolio of R3,000 crore,” he said.
Manappuram Finance has 3,293 branches across 22 states with nearly 2 million customers.
The gold loan company estimates a de-growth in the current fiscal due to a sluggish market.
Manappuram Finance had recorded a 16% decline in its net profit for the third quarter of the current fiscal. The net profit for the last quarter stood at Rs 71.05 crore as against R84.38 crore in the corresponding period last fiscal.