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Star Housing Finance Limited (Star HFL), a prominent player in the home finance sector, has announced a substantial capital infusion of Rs 60 crore, following board and awaiting shareholder approval. This strategic move aims to accelerate the company's growth trajectory and expansion initiatives. This announcement was made in a recent BSE filing by the company.
With a remarkable year-on-year growth, Star HFL's Assets Under Management (AUM) soared to Rs 319.43 crore as of September 30, 2023, marking a 110% increase. The first half of the financial year 2024 (H1 FY24) saw the company disburse Rs 108.30 crore, a 49% hike compared to the previous year, underscoring the firm's upward growth trend.
Kalpesh Dave, the CEO of Star Housing Finance, expressed enthusiasm over the investment, emphasizing the company's commitment to leveraging these funds to reach an AUM of Rs 500 crore.
The capital raise entails issuing up to 93,78,500 convertible warrants priced at Rs 64 each, with a provision for the warrant holders to acquire one equity share at a premium, thereby aggregating to Rs 60.02 crore. This issuance will include both promoter and non-promoter entities through a private placement.
Star HFL plans to utilize this capital to double its growth rate, enhance its brand visibility, recruit top-notch talent to reinforce its leadership, diversify its loan portfolio, invest in state-of-the-art technological solutions, and expand its market presence in key regions. Additionally, the board has appointed Chinnathambi Ilango as a non-executive independent director, further strengthening its governance framework.
The company also reported a reduction in its PAR (0+ days past due) to 4.52% as of September 30, 2023. Its gross non-performing assets (NPA) stood at 1.46%, with a net NPA of 1.08%. Star HFL's consolidated total income for Q2 FY24 was Rs 13.67 crore, a significant 58.58% increase from the same quarter last year. Its profit after tax also saw a healthy rise of 20.47%, amounting to Rs 2.06 crore in Q2 FY24.
In conclusion, Star Housing Finance's strategic capital raise and robust financial performance highlight its strong market position and commitment to sustainable growth. With these developments, the company is well-positioned to scale new heights in the housing finance sector, offering enhanced services and solutions to its customers.
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