Any current/future new fundraising through debt or equity?

The company has raised Rs. 167.40 crore during FY22 through debt, with 36% from banks, 43% from financial institutions, and 21% from National Housing Bank. Gearing is currently about 2.5x and is expected to increase to around 3.67x with recent funding of Rs. 115 crore. The management plans to raise equity only after the loan book reaches Rs. 500 crore. No immediate equity fundraising is planned; equity issuance will be considered post achieving the target loan book size. The company aims to achieve a loan book of Rs. 500 crore in FY23 and then look at equity funding to support further growth.

Any current/future capex/capital investment/strategic investment?

SRG Housing Finance is currently in an expansion phase, focusing on branch and team growth. They have opened 9 new branches recently and plan to increase the total branches to around 50-51 by March. New branches planned: 5-6 in Madhya Pradesh, 3 in Rajasthan, and 3-4 in Gujarat. The company is building new teams and investing in technology and software development. Employee hiring is ongoing with approximately 100 new employees added in the last quarter. No explicit mention of large-scale capital expenditure, but investments in branch expansion, human resources, and technology indica

Future growth expectations in sales/revenue/volumes?

SRG Housing Finance aims to grow its loan book to Rs. 500 crore by the end of FY'23, targeting a 50% growth from Rs. 320-325 crore in FY'22. The company plans to expand to 50 branches by March, adding 4-5 new branches mainly in Rajasthan, Madhya Pradesh, and Gujarat. Expected quarterly disbursement run rate is Rs. 50 crore, indicating steady sales momentum. Business environment is improving post-COVID, with increased loan sanction and disbursement activities. Expansion includes a strengthened team with 100 new employees appointed in the last quarter to support growth. Collections are primarily

Current/ Expected Orderbook/ Pending Orders?

SRG Housing Finance Limited targets an AUM (Asset Under Management) of Rs. 500 crore by the end of FY'23. The company plans a quarterly disbursement run rate of around Rs. 50 crore, supported by branch expansion. They currently have 46 branches and plan to expand to about 50-51 branches by March, focusing on Rajasthan, Madhya Pradesh, and Gujarat. Disbursement in April-May 2022 is positive and comparable or better than the previous year, with sanctioned loans being disbursed. The business momentum is improving post-COVID, with new team appointments and technology enhancements supporting growth

IN US

SRG HousingQ1 FY23Finance

SRG Housing Q1 FY23 Earnings Call Analysis

Revenue, margin, capex, fundraise and order book outlook from management commentary.

Price: ₹287P/E: 13.3Market Cap: ₹456 CrSector: Finance

Management growth scorecard

Revenue

Category 2

Margin

Category 3

Fundraise

Yes

Order

Yes

Capex

Yes

3 of 5 growth signals are positive.

Full analysis

Revenue guidance

Category 2

→SRG Housing Finance aims to grow its loan book to Rs. 500 crore by the end of FY'23, targeting a 50% growth from Rs. 320-325 crore in FY'22.
→The company plans to expand to 50 branches by March, adding 4-5 new branches mainly in Rajasthan, Madhya Pradesh, and Gujarat.
→Expected quarterly disbursement run rate is Rs. 50 crore, indicating steady sales momentum.
→Business environment is improving post-COVID, with increased loan sanction and disbursement activities.
→Expansion includes a strengthened team with 100 new employees appointed in the last quarter to support growth.
→Collections are primarily electronic (95% via ECS/Online), ensuring operational efficiency.
→Management is cautiously optimistic, with growth dependent on market conditions and no major unforeseen hurdles like new COVID variants.

Margin guidance

Category 3

- SRG Housing Finance aims to achieve an AUM of Rs. 500 crore by the end of FY'23, indicating around 50% growth from the current Rs. 340 crore book. - Business expansion is supported by opening new branches (targeting ~50 branches by March) and appointing new employees to drive growth. - Management expects an improvement in revenue as new branches and employees start generating business, leading to a reduction in the cost-to-income ratio toward ~40%. - Net Interest Margin (NIM) is targeted to maintain around 10.6% to 12%, despite interest rate fluctuations, given fixed-rate lending. - Profit before tax grew by 7% in FY22 and 57% in Q4; PAT grew 8% in FY22 and 59% in Q4; expectations suggest these growth trends could continue with market normalization. - EPS stood at Rs. 16 in FY22 with prospects of sustainable or improved earnings as disbursements and collections stabilize post-COVID. Overall, management is cautiously optimistic about achieving growth in earnings and profitability aligned with business expansion plans.

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Fundraise plans

Yes

→The company has raised Rs. 167.40 crore during FY22 through debt, with 36% from banks, 43% from financial institutions, and 21% from National Housing Bank.
→Gearing is currently about 2.5x and is expected to increase to around 3.67x with recent funding of Rs. 115 crore.
→The management plans to raise equity only after the loan book reaches Rs. 500 crore.
→No immediate equity fundraising is planned; equity issuance will be considered post achieving the target loan book size.
→The company aims to achieve a loan book of Rs. 500 crore in FY23 and then look at equity funding to support further growth.

Order book

Yes

→SRG Housing Finance Limited targets an AUM (Asset Under Management) of Rs. 500 crore by the end of FY'23.
→The company plans a quarterly disbursement run rate of around Rs. 50 crore, supported by branch expansion.
→They currently have 46 branches and plan to expand to about 50-51 branches by March, focusing on Rajasthan, Madhya Pradesh, and Gujarat.
→Disbursement in April-May 2022 is positive and comparable or better than the previous year, with sanctioned loans being disbursed.
→The business momentum is improving post-COVID, with new team appointments and technology enhancements supporting growth.
→No specific mention of pending orders; the focus is on achieving the Rs. 500 crore book size through ongoing disbursements and branch expansion.

Capex plans

Yes

→SRG Housing Finance is currently in an expansion phase, focusing on branch and team growth.
→They have opened 9 new branches recently and plan to increase the total branches to around 50-51 by March.
→New branches planned: 5-6 in Madhya Pradesh, 3 in Rajasthan, and 3-4 in Gujarat.
→The company is building new teams and investing in technology and software development.
→Employee hiring is ongoing with approximately 100 new employees added in the last quarter.
→No explicit mention of large-scale capital expenditure, but investments in branch expansion, human resources, and technology indicate strategic growth capex.
→They plan to increase leverage (gearing) to about 3.67x (from current 2.5x), having already raised Rs. 115 crore last year for funding growth.
→Equity raising is planned once the loan book reaches Rs. 500 crore.

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