The largest lodging finance company in India and recognized by National Housing Bank is known as LIC Housing Finance Limited ( LICHFL ) , holding web of six regional offices, 126 marketing units across India and overseas representative offices in Dubai and Kuwait. The Company was promoted by Life Insurance Corporation on 19th June 1989. The chief aim of the company is supplying long term finance to persons for purchase / building / fix and redevelopment of new / bing flats / houses. The Company besides provides finance on bing belongings for concern / personal demands and gives loans to professionals for purchase / building of Clinics / Nursing Homes / Diagnostic Centres / Office Space and besides for purchase of equipments. A
A During the twelvemonth 1989, the company had introduced assorted strategies like, Griha Prakash a general strategy, Griha Tara under which it accepts merely Bima Sandesh Plan as Life Insurance Corporation, Griha Shobha for Non Resident Indians ( NRI ) and Griha Lakshmi for people to hold a 2nd house. In the twelvemonth of 1994, LICHFL ‘s position was converted to Public Limited Company from Private Limited Company. The company had decided to transport out fund based and one-fund based activities during the period of 1996 via debt securitization, rental and hire purchase, leasing of belongingss and giving warrant to co-operate organic structures. In the period of 2001, the company had launched its new strategy called Griha Vikas. In 2002, LICHFL had signed a title of assignment to take over single lodging loan portfolio of Citibank. The company had unveiled a new undertaking for aged people called LICHFL Care Homes in the twelvemonth 2003. LICHFL had successfully concluded its inaugural offering of Global Depository Shares ( GDS ) in the twelvemonth 2004 and besides the company had introduced flexi-fixed strategy offering fixed rate of involvement for first five old ages and variable thereafter. A
A In October of the twelvemonth 2005, the company had started offering of ‘New Griha Laxmi ‘ lodging loans against the security of certain sanctioned fiscal assets like Bank Fixed Deposits, National Savings Certificates and Life Insurance Policies. In the twelvemonth of 2006, the company had introduced new Griha Jestha for senior citizens for purchasing unit of LICHFL Care Homes Limited. First clip since its origin, the company had launched maiden Fixed Deposit Scheme in May of the twelvemonth 2007, LICHFL decided to raise resources from single depositors via an attractive Fixed Deposit strategy. The Company had formed three new entirely owned subordinates in 2007-08 to pull off its involvements in fiscal services, venture fund and plus direction. In February of the twelvemonth 2008, LICHFL had launched contrary mortage for senior citizens above 60 old ages of age. In the same twelvemonth, the company had launched a new venture capital fund for real property undertakings. CRISIL assigns AAA ( so ) /Stable evaluation to Series A1, A2 to the company in June 2008.A
A The Company is processing with the vision of to be the best lodging finance company in the state and besides with the mission of Provide secured lodging finance at an low-cost cost, maximising stockholders ‘ value with higher client sensitiveness.
Beginnings OF Fundss
Year
Mar 10A
Mar 09A
A A SOURCES OF Fundss:
A
A
A Share Capital
95.00
85.00
A Militias Total
3,292.68
2,149.10
A A Total Shareholders Fundss
3,387.68
2,234.10
A Secured Loans
31,014.98
23,523.95
A Unsecured Loans
3,743.17
1,897.71
A Total Loan Fundss
34,758.15
25,421.66
Break up of Secured Loans
( Rs in Crs )
Year
Mar 10
Non Convertible Unsecured bonds
17,053.40
Term Loans Institutions
2,309.98
Term Loans Banks
11,651.60
Break up of Unsecured Loans
( Rs in Crs )
Year
Mar 10
Unsecured bonds / Chemical bonds
2,444.99
Loans from Institutions
156.81
Commercial Paper
815.18
Sum DEPOSITS
326.19
Fixed Deposits
326.19
PUBLIC DEPOSIT SCHEME
LIC Housing Finance Limited has started the Public Deposit Scheme from 10th May, 2007 onwards. The Deposits accepted under Accumulative Option and Non-Cumulative Option. The footings of the sedimentations are 1 twelvemonth, 18 months, 2 old ages, 3 old ages & A ; 5 old ages in both the strategies.
In 2007-08 15.7 Crs was raised.The public sedimentations increased to 161.78 Crs in 2009 and to 326.19 Crs by Mar 2010.
Fundss Flow
Year
Mar 10
Beginnings of financess
Cash net income
667.7
Increase in equity
10
Increase in other networth
623.8
Increase in loan financess
9336.49
Entire Inflow
10637.99
Major FINANCIAL INSTRUMENTS
The major Money Market Financial Instruments used to raise financess are as follows:
1.Commercial Paper
Issued by corporates, Bankss and fiscal houses
Secured by 3rd party warrant
Primary issue through private arrangement
Held by corporates, Bankss, common financess, insurance companies, and so on
Important beginning of working capital finance in developed economic systems
Competition to traditional on the job finance loans given by Bankss
Rate offered depends on fiscal place of issuer and surety
Banks and fiscal houses as the largest issuers of CP ‘s
The growing of Asset Backed Commercial Paper
Underliing assets as collateral
More volatile involvement rates in secondary markets
CP ‘s sold at a price reduction to confront value
Not really widespread usage of CP ‘s in India
Minimum adulthood of 7 yearss
2.Certificates of Deposits
Issued by Bankss
Unbarred instruments
Held by corporates, other Bankss, common financess
Highly of import instruments in developed economic systems
Initially developed to acquire around bank sedimentation involvement rate limitations
Rate offered depends on fiscal place of issuer
Longer adulthood Cadmium ‘s besides allowed in India
Merely to O.K. non-bank fiscal establishments
Banks can non publish CD ‘s with adulthood greater than 1 twelvemonth
Same modesty demand as for bank sedimentations
Procedure OF FUND RAISING
Fund elevation
The Company raised financess aggregating to Rs.17,004.35 crore through term
loans from Bankss, Non-Convertible Debentures ( NCD ) , upper grade II Bonds,
commercial paper, NHB refinance and Public Deposit. The Company ‘s NCD & A ;
Upper Tier II subordinate Bond issue and bank loans were rated ‘AAA/Stable ‘
and Public Deposit was rated as FAAA/STABLE by CRISIL. The Company
mobilised Rs.658 crore by private arrangement of equity through Qualified
Institutional Placement.
Qualified Institutional Placement
To run into the turning demands, the Company raised financess through a Qualified
Institutional Placement ( QIP ) of 10 million equity portions amounting to
Rs.658 crore
Beginnings of Fundss
Share Capital
Militias Total
Capital Markets in India
Government Securities Market
Equity Markets
Corporate Unsecured bond Market
Primary Issues in Equity Markets
Raising larger sums of capital
An extra beginning of capital
Repute effects
Updated information for determination devising
Equity as dearly-won beginning of financess
Issues of equity by a company infrequent
Primary Issues in Equity Markets
Chiefly public issue
IPO – Initial Public Offer
Shareholding Pattern
( AS ONA Jun A 2010 )
Shares
[ % ]
Foreign
30,674,836.00
32.31
Institutions
17,441,560.00
18.37
Govt Keeping
23,755.00
0.03
Non Promoter Corp. Hold.
3,236,185.00
3.41
Promoters
34,688,499.00
36.54
Public & A ; Others
8,867,765.00
9.34
Sums
94,932,600.00
100.00
Market Data ( As on September 02, 2010 )
Price ( Rs )
1203.6
52 W H/L ( Rs )
1310.8 / 626.1
Lat. EPS ( Rs )
79.04
Lat. P/E
15.2277
Mkt. Cap. ( Rs Cr )
11425.8
Lat.Eqty ( Rs Cr )
94.93
Lat. BV ( Rs )
356.85
Div. Yield ( % )
1.2463
Break up of Share Capital
( Rs in Crs )
Year
Mar 10
Equity Authorised
150.00
Equity Issued
95.00
Equity Subscribed
95.00
Equity Called Up
94.93
Equity Forfeited
0.07
Equity Paid Up
95.00
Discriminatory issue of Shares
On 23rd Sep 2009 the company allotted 10000000 portions at a premium of Rs.648 per portion to QIP ‘s.
Corporate Unsecured bond Market
Non-Convertible Debentures ( NCD )
Typical Investors in Corporate Debt
Chiefly subscribed by big investors
Typically for really big issues
Bad High giving up bonds
New Companies, Leveraged Buyout Transactions, Ratings Downgrades
upper tier II Bonds
Mentality for 2010-11
Raising financess through loans at attractive rate of involvement and footings.
Bankers of LIC Housing Finance
Andhara Bank
Axis Bank
Corporation bank
HDFC Bank Ltd
State Bank Of India
Union Bank Of India
Summary
The cost of financess has been increasing continuously, but outputs have besides gone up. Around 95 % of the outstanding single loans comprised drifting rate loans. This enabled LICHF to keep Net Interest Margin by sporadically go throughing on the consequence of alterations in its ain adoption cost to clients. It has now passed on the diminution in involvement rates to its clients.