Home loan major foresees 10% growth this fiscal

It has been exactly a decade since Sundaram Finance Ltd (SFL) forayed into the home loan space through a joint venture with BNP Paribas Personal Finance, formerly known as Union de Credit pour le Batiment (UCB), a wholly-owned subsidiary of BNP Paribas France. After regulatory approvals, the entity – Sundaram BNP Paribas Home Finance, was created. 

One of every four flats that the company finances, is a second-hand property, says Acharya, who goes on to add that the home finance leader’s portfolio is skewed in favour of cities due to large ticket-size transactions albeit the fact that business in Tier 2 locations has also shown good outcomes. In his view, almost a year since the note ban, initial inconveniences appear to have worn off. “This helps in the real estate sector to witness real valuation. Also, the probable neutralisation of black money has paved the way for genuine buyers into the market. We are seeing increased volume of transactions in second sale of houses,” he adds. 

Noting that the financing major has been seeing increasing growth opportunities in a transparent environment, Acharya says, “As far as the home finance segment is concerned, we are confident of a steady growth in the near as well as the long term.” According to him, despite operating in a stiff competitive environment, “We feel that there are opportunities for everyone to grow. The real issue is the delay in housing projects due to approvals.” 

For the company, a sizeable chunk of its business is from TN, where it continues to grow. Satisfied with its performance in other southern states, he says “Our footprint outside South has given us good traction. We find that except for TN, all other markets are growing substantially. But this year, we are upbeat about posting good growth in TN. We are looking at a growth of over 10 per cent in the housing loan segment.” 

Acharya goes on to add that the efforts to conduct more localised events and customer awareness programmes have yielded good results. On emerging trends, the leader opines, “The average age of home buyers has come down to the 30s. Even youngsters are no longer buying houses for investment or rental income, but to live in the same.”