Financial Services - Business
at a Glance

PEL’s Financial Services segment offers a comprehensive suite of financial products to meet the diverse and evolving needs of its customers. The Company has created its unique positioning in the financial services space through its strong presence in the following sub-segments:

Wholesale Lending

BUSINESS DESCRIPTION

LOAN BOOK/AUM

PRODUCTS/SERVICES

Real Estate
Wholesale Lending

End-to-end real estate financing model

`31,833 Cr

87%
5-year CAGR

  • Mezzanine Lending
  • Construction Finance-Residential
  • Construction Finance-Commercial
  • Lease Rental Discounting

Corporate Finance Group

Sector agnostic corporate lending book (non - Real Estate)

`8,209 Cr

118%
3-year CAGR

  • Senior Lending
  • Promoter Funding
  • Loan Against Shares
  • Mezzanine & Structured Lending
  • Project Finance
  • Acquisition Funding
  • Capex Funding
  • Working Capital Term loan

Emerging Corporate Lending

Lending to emerging and
mid-market companies

`916 Cr

Launched in FY2018

  • Senior Debt
  • Loan Against Property
  • Lease Rental Discounting
  • Structured Debt
  • Loan Against Shares
  • Project Finance
  • Loan Against Receivables
  • Acquisition Financing

Alternative Asset Management

The platform in its fiduciary capacity also manages alternate AUM under several categories

`7,620 Cr

Assets Under Management

  • Alternate Funds
  • Third party Mandate
  • Managed Account
  • Strategic Partnerships:
    APG, CPPIB, CDPQ

Retail Lending

Housing Finance

Entered retail lending through housing finance business -
a natural extension to our end to end real estate financing solution

`1,210 Cr

Launched in FY2018

  • Retail Housing Loans
  • Loan Against Property
  • Small Construction Finance
  • Affordable Housing

Investments in Shriram Group

Leading player in used Commercial Vehicle and Micro, Small and Medium Enterprises financing

`4,583 Cr

Amount invested

  • 10% in STFC - `1,636 Crore
  • 20% in SCL - `2,146 Crore
  • 10% in SCUF - `801 Crore

Stressed Assets

India Resurgence Fund

Debt and/or equity in assets across sectors (other than real estate) to drive restructuring with active participation in turnaround

Initial contribution of

US$100 Mn each

by PEL and Bain Capital Credit

  • JV with Bain Capital Credit
  • Target to launch US$1 Billion fund

KEY HIGHLIGHTS

  • 69% Y-o-Y growth in Loan Book in FY2018
  • Gross NPAs of 0.3% as on March 31, 2018
  • FY2018 ROE - 19%
  • Merger of Piramal Finance and Piramal Capital with Piramal Housing Finance to create significant synergies
  • The consistent growth in Loan Book is an outcome of strong diversification - Launched 22 products across various business verticals
  • 98% Real Estate lending in Tier I cities of Mumbai, Pune, Bengaluru Hyderabad, Chennai and NCR
  • 70% of the portfolio comprising of Grade A Developers
  • Relationship with 120+ developers and presence in 375+ projects pan India
  • Launched Housing Finance offerings in Delhi-NCR, Bengaluru and Pune. Plan to open branches in Nashik, Ahmedabad, Hyderabad and Chennai in near term
  • Partnered with 445 connectors, 123 Direct Sales Agents & 100 projects on the Housing Finance platform
  • 22 corporate borrower groups on our Corporate Finance Group (CFG) platform
  • Formed the Capital Markets and Advisory group which houses the Corporate Client Coverage Group (CCG) and the Syndication Group (SG)

Expanded presence in retail financing with the launch of Housing Finance Company (HFC)

  • Launched HFC and entered 4 cities - Mumbai, Pune, Delhi - NCR and Bengaluru during FY2018
  • Loan Book size of `1,210 Cr in 6 months of launch
  • Natural extension to our end-to-end real estate financing platform to help the developers
  • B2B2C model wherein the developer relations would play an important role

Created India’s second largest and a high quality real estate developer financing platform

  • PEL’s real estate developer financing Loan Book has grown at a robust CAGR of 112% over last 6 years.
  • Consistently delivering 50%+ Y-o-Y growth in Loan Book in each of the last 12 quarters
  • End-to-end real estate developer financing platform offering product solutions right from the time of land purchase to housing finance
  • Real Estate lending in Tier I cities of Mumbai, Pune, Bengaluru, Hyderabad, Chennai and NCR
  • Strong relations with 120+ developers and has presence in 375+ projects pan India

Consistently delivered an ROE of 25%+ and GNPA of 0.3%. Among the best performing players in the industry

  • ROE of 25%+ over last 10 consecutive quarters (prior to the fund raise through QIP and Rights Issue)
  • Consistently maintaining a healthy asset quality below 1% since last 9 quarters
  • Robust governance mechanism with the legal and risk teams reporting directly to board for reviewing any deals
  • Dedicated asset monitoring team to assess early warning signals

Merger of Piramal Capital and Piramal Finance into Piramal Housing Finance

  • Merger of Piramal Finance and Piramal Capital with Piramal Housing Finance got effective from March 31, 2018
  • Benefits of merger:
    • Expected to improve the annual ROE of the Financial Services business by 2-3% in the next few years
    • Borrowing cost expected to go down from 25 to 50 basis points
    • Diversified portfolio comprising both retail and wholesale should improve credit rating
    • Mutual Fund can lend higher amount to HFCs as against NBFCs (40% vs. 25% of overall lending)