DHFL’s issue opened for subscription on Wednesday and according to latest NSE data, it has been subscribed nearly 19 times. The issue size is Rs 1,000 crore with an option to retain over-subscription up to Rs 4,000 crore.
The proceeds of the issue will be used for onward lending, financing and general corporate purposes. The issue, rated ‘AAA’ by Care Ratings will be open for subscription till August 16.
DHFL is offering yields up to 9.3 per cent, depending upon the class of investors – whether retail or high networth individual – and the tenor.
Analysts say that the fresh funds will give DHFL significant leverage for its lending activity, helping boost its net interest margin.
DHFL has posted strong June quarter performance with net profit rising 16 per cent to Rs 201 crore. Its loan book grew 18.3 per cent to Rs 63,646.6 crore while gross NPA stood at 0.98 per cent.
DHFL has reported net interest margin at 2.9 per cent in the June quarter. Lower bad loans as compared to banks and prospects of further growth in lending activity on the back of Seventh Pay Commission awards have led to investors flocking to shares of housing finance companies. Shares of DHFL are up nearly 70 per cent from its February lows.
Shares of DHFL ended 4.5 per cent higher at Rs 234 as compared to a flat Nifty.