Expect disbursement growth at 20-25% in FY17: Gruh Finance

Gruh Finance is likely to see disbursement growth of 20-25 percent in FY17 says Managing Director Sudhin Choksey in an interview to CNBC-TV18 after the housing finance company reported its fourth quarter earnings. Net profit for the quarter increased 18.5 percent year-on-year to Rs 87.80 crore and net interest income (NII), too, saw a rise of 24.2 percent YoY to Rs 151.82 crore. Due to poor performance of residential realty, there has been pressure on its books, leading to a slow loan-asset growth rate, he added. Choksey, however, believes that Budget 2016 allotment and 'Housing for All' initiative will improve the real estate conditions of India. Below is the verbatim transcript of Sudhin Choksey's interview with Latha Venkatesh and Sonia Shenoy on CNBC-TV18. Sonia: What the disbursement growth could be for FY17? A: We are looking at loan asset growth in the vicinity of around 20-25 percent. Latha: Are you seeing any pressure on your numbers because of the poor performance of real estate generally, real estate residential? A: That is true. If you look at the last year, quarter-after-quarter, the loan asset growth has moved at a slower pace compared to what we used to experience earlier. We are hopeful with the initiatives that the government has taken both through Budget as well as through the housing for all policy. Going forward, there could be an improvement in the real estate sector. Latha: Are your spreads under pressure or are they improving? On the one hand, you have advantage of a wholesale cost of money going down but on the other everyone is giving home loans now? A: That is true. I think we have to look it. Everybody is talking of a home loan. How many of them have been giving the loan against property? If you look at it, if there has not been a property transaction then how come home loans have been growing at such a high rate.