LIC Housing Finance Plans to Issue 10-Year Bonds Worth 70 Billion Rupees.

LIC Housing Finance plans to raise 70 billion rupees ($810 million) through the sale of 10-year bonds. The issue size includes 25 billion rupees of base issuance and a 45 billion rupees greenshoe option. The company has invited bids from bankers and investors on Friday. The bonds will be rated AAA by Crisil and Care.

In a significant move to bolster its financial position and support environmentally sustainable housing projects, India's leading housing finance company, LIC Housing Finance, has announced plans to raise a combined total of approximately 110 billion rupees ($1.28 billion) through various funding channels [1].

According to a report by Reuters, LIC Housing Finance aims to raise 40 billion rupees ($459.45 million) via the sale of two-year bonds, which includes a 30 billion rupees greenshoe option. The company has invited bids from bankers and investors on March 17 [1]. This funding round is not the only source of capital for LIC Housing Finance; the company also plans to mobilize funds through green bonds in the next financial year [2].

LIC Housing Finance, the mortgage arm of Life Insurance Corporation (LIC), has been on an impressive growth trajectory. The company aims to reach a net profit of ₹5,000 crore ($609 million) by the end of the current financial year, driven by robust loan demand and expansion in non-core business segments like Loan Against Property (LAP) and affordable housing finance [2].

The affordable housing segment has remained a strong performer for LIC Housing Finance, particularly in tier-2 and tier-3 markets. According to Tribhuwan Adhikari, MD and CEO of LIC Housing Finance, the company has remained focused on this segment due to its potential to provide millions of aspiring Indians with the opportunity to own their homes at moderate prices [2].

Aside from business growth, LIC Housing Finance has also been working on improving service standards through ongoing digital initiatives. In addition to its primary focus on providing housing finance solutions, the company also offers credit cards and other financial products to its customers [1].

References:

[1] Dharamraj Dhutia. India's LIC Housing Finance to issue 2-year bonds, bankers say. Reuters. 13 March 2023. https://www.reuters.com/business/india/india-new-issue-lic-housing-finance-to-issue-2-year-bonds-bankers-say-49318785/

[2] Arun Kumar. LIC Housing Finance plans to raise funds via green bonds in next financial year. The Hindu Business Line. 7 March 2023. https://www.thehindubusinessline.com/money-and-banking/lic-housing-finance-plans-to-raise-funds-via-green-bonds-in-next-financial-year/article67909930.ece