The fund raising will be done through a mix of term loans from banks, refinance from NHB, NCDs, subordinated debt, fixed deposits and commercial papers, says Srinivas Acharya, MD, Sundaram BNP Paribas Home Finance.

Sundaram Home Finance’s funding profile is fairly diversified with NHB refinance and debentures constituting 31% and 33% of the total borrowings respectively as in Mar 2018. Fixed deposits contribute to 15% to the funding mix. Sundaram Home Finance has a deposit base of Rs 1,042 cr. There was a gross addition of Rs 387 cr last year. The company’s access to diverse funding sources and its strong franchise provides comfort on the financial flexibility.

Sundaram Home Finance has revised, upwards, the interest rate on fixed deposits by 50 bps across all tenor. Senior citizens would now get 8% pa for 12/18-Month deposit, 8.25% pa for 24/36-Month deposit and 7.75% pa for 48/60-month deposit. Trusts would now get interest @ 8.25% pa for a 36- Month deposit.

Over the medium term, the company aims to continue to focus on the southern states and increase penetration in its existing areas of operations. The company has over 110 branches spread across the country and over 50,000 customers. 

Meanwhile, the premier rating agency ICRA has upgraded the company’s fixed deposit rating to MAAA (Stable) from MAA+. The outlook on the long-term rating is reaffirmed at AA+ Stable.  The ratings continue to factor in the strong parentage with Sundaram Finance Ltd and BNP Paribas Personal Finance and their demonstrated operational, managerial and financial support to Sundaram Home Finance. The ratings also consider the company’s established franchise in S India, its management team, track record, among other factors.