Truhome Finance awaits rating upgrade after doubling AUM to Rs 20,000 crore

Ravi Subramanian, MD & CEO, Truhome Finance (Formerly Shriram Housing Finance)

Truhome Finance Ltd (formerly Shriram Housing Finance) has crossed the Rs 20,000-crore mark in Assets Under Management (AUM), cementing its position as the third-largest player in the affordable housing finance segment.

The company, which rebranded from Shriram Housing Finance to Truhome Finance earlier this year, has doubled its AUM from Rs 10,000 crore to Rs 20,000 crore in just two years. Over the last five years, Truhome’s AUM has grown at a compounded annual rate of nearly 45 percent.

Currently at No. 3 position with an AUM of Rs 20,000 crore, Truhome trails behind Aadhar Housing Finance (Rs 27,000 crore) and Aavas Financiers (Rs 21,000 crore). “On fresh disbursements, we are neck and neck with Aadhar,” said Ravi Subramanian, Managing Director and CEO, Truhome Finance.

The company, which operates close to 200 branches and employs nearly 5,000 people, plans to expand its network to about 250 branches by the end of FY26.

“Crossing Rs 20,000 crore in AUM is not just a financial milestone but it reflects the faith our customers place in us and the dedication of our team,” Subramanian said. “Over the next two quarters, we expect to emerge as the second-largest affordable housing finance company in the country.”

Truhome expects to post profits exceeding Rs 500 crore in the current fiscal year. This performance has been supported by a capital infusion from global private equity firm Warburg Pincus, which acquired the company from Shriram Finance Ltd in December 2024.

Warburg is expected to provide additional growth capital as Truhome scales up further.

After a rating downgrade following the Warburg Pincus deal, the company is now on course for a rating upgrade, which could help reduce its cost of funds. The average cost of funds currently stands at 8.2 percent, while the incremental cost is slightly below 8 percent.

“Our focus is on taking affordable housing finance deeper into semi-urban and rural India,” said Subramanian. Incremental growth, he noted, is coming largely from Tier 2 and Tier 3 cities, where demand for housing finance continues to rise.

He added that Truhome’s aspiration has evolved from becoming the largest affordable housing finance company to becoming the best in terms of scale, governance, people, and asset quality.

The company has ruled out inorganic options to gain scale, emphasizing organic growth through its branch network and customer outreach.

Under the terms of its acquisition, Truhome also has a three-year non-compete clause with Shriram Finance, restricting it from entering the latter’s affordable housing loan segment.

“With a clear roadmap and strong investor backing, we are confident of reaching ₹25,000 crore in AUM by the first quarter of next year,” Subramanian said. “Our investments in technology and people are paying off, enabling us to scale rapidly without compromising on risk management.”