"In the NBFC (Non-banking Finance Company) space, many of the NBFCs have actually stopped lending or reduced their lending and therefore this gives us an opportunity to grow organically " said Ajay Piramal.
Ajay Piramal, Chairman of Piramal Group said he plans to utilise capital raised from the sale of healthcare analytics subsidiary and rights issue for growth opportunities in the financial services business.
Piramal told Moneycontrol that he would also look at opportunities that could come in for inorganic growth.
Piramal Enterprises on January 17 said it had signed a definitive agreement for the sale of healthcare insights and analytics subsidiary Decision Resources Group (DRG) to US-based Clarivate Analytics for a sale consideration of $950 million.
Piramal will receive $900 million on closing of the deal and $50 million to be received at the end of 12 months from the date of closing.
This transaction is expected to be completed by February-end this year.
DRG caters to the information needs of pharmaceutical, insurance and hospitals, had contributed Rs 1330.74 crore or about 10 percent of Piramal’s consolidated revenue of 13,215 crore. Around 53 percent of Piramal revenues came from financial services. Piramal has a loan book of Rs 53,055 core as of September 2019.
Piramal is also in the process of raising rights issue of Rs 3,650 crore from its existing shareholders, in addition to raise Rs 1,750 crore through the preferential allotment of CCDs to Canadian institutional investor, Caisse de dépôt et placement du Québec (CDPQ)
"Sometime in the first quarter of this year, we have said that we will raise Rs 8000-Rs10,000 crore of equity from our companies. With divestment of DRG as well as the rights issue, we will achieve our target, or in fact will exceed it. I believe that there are lots of opportunities that are there in the market as far as financial services are concerned. In the NBFC (Non-banking Finance Company) space, many of the NBFCs have actually stopped lending or reduced their lending and therefore this gives us an opportunity to grow organically and as well enter those areas where others are not lending.
I want to make more diversified and granular book, as far as NBFC is concerned. In addition, I see that there are many opportunities that could come in for in organic growth and we will look at those as well," Piramal said.
As part of the efforts to diversify loan book which was skewed towards real estate which isn't doing well, Piramal said he is in conversation with banks to do co-lending.
"We wanted to make our book granular, and therefore we will look at doing co-lending platform with banks and with other institutions both in India and globally," Piramal said.Piramal said he is not looking at any further divestments of businesses.
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