RHDFCL gets rating boost from ICRA, eyes growth in affordable housing finance

Religare Housing Development Finance Corporation Limited (RHDFCL), a step-down subsidiary of Religare Enterprises Limited (REL), has achieved a significant financial milestone as ICRA Limited upgraded its credit rating to [ICRA]BBB- (Stable)/[ICRA]A3 for its long-term and short-term bank lines valued at INR 400 crores. This rating upgrade from the previous [ICRA]BB (Stable)/[ICRA]A4 reflects RHDFCL’s bolstered financial profile and operational stability.

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The rating elevation is attributed to notable improvements at the Religare group level, including the recognition of the Burman Group, promoter family of Dabur India Limited, as promoters of REL. Additionally, initiatives to strengthen the board composition at REL have positively impacted the group’s overall credit standing.

RHDFCL has demonstrated financial stability, with a net worth of INR 208 crores and a managed gearing ratio of 0.3 times as of December 31, 2024. Asset quality has also improved, with gross stage 3 assets declining to INR 8.3 crore, down from INR 12.3 crore as of March 31, 2023. The company remains focused on the affordable housing finance sector, with home loans representing approximately 70% of its portfolio as of December 2024.

With the easing of concerns over group-related issues that previously impacted RHDFCL’s performance, the company expects improved funding access and a more robust disbursement trajectory in the near future. RHDFCL continues to operate as a retail affordable housing loan financier with an average ticket size of approximately INR 11 lakhs. The company has also established co-lending partnerships aimed at stimulating business volume growth and anticipates increased traction in this area over the medium term.

Rahul Mehrotra, Managing Director and CEO of RHDFCL, stated that the rating upgrade is a significant achievement, reflecting the company’s commitment to maintaining financial health while pursuing sustainable growth in the affordable housing finance sector. He further mentioned that the improved rating is expected to provide enhanced access to bank lines and funding opportunities at more competitive rates, enabling the company to expand its market reach and better serve customers in the affordable housing space.

RHDFCL, a housing finance company catering to underserved, low-income, and informal segments, offers home-purchase, home construction, and home improvement loans. The company’s underwriting framework targets individuals in the informal sector across urban and semi-urban India, positioning itself as a key player in the affordable housing finance sector.

Religare Enterprises Limited (REL) is a diversified financial services group operating across multiple verticals, including loans to SMEs, affordable housing finance, health insurance, and retail broking. The group has a widespread presence across over 400 cities, catering to more than 1.1 million clients through 1,275 locations nationwide.

The company’s emphasis on affordable housing finance, supported by its focus on the underserved and informal sectors, positions it well for continued growth. Moving forward, RHDFCL aims to capitalise on improved funding access, strengthened co-lending partnerships, and targeted market outreach as it seeks to expand its footprint in the affordable housing finance segment.

Source – PTI