MSPEA backs Indian affordable housing financier

Established in 2017, CHF is a unit of the Centrum Group, a diversified financial services conglomerate that earlier focused on merchant banking, foreign exchange, and wealth management services. In recent years, it has launched operations targeting small and medium-sized enterprise (SME) finance, microfinance and housing finance. Outstanding housing loans were nearly four times the size of other loan types in its portfolio last year.

Offering loans between $4,000-85,000, chiefly for individuals seeking to purchase, build or improve homes in smaller cities, the company claims to have disbursed INR5 billion in credit to more than 3,500 customers. It plans to use the fresh capital to expand its operations nationwide. It is one of 82 registered non-banking housing finance providers in the country.

“The affordable housing space in India is underpenetrated and offers tremendous opportunity for growth. We believe that CHF is well-placed in this segment given its strong retail focus, robust underwriting and collection mechanism, and disciplined ALM (asset-liability management)," said Arjun Saigal, co-head of Morgan Stanley Private Equity Asia in India. The GP will take a minority stake of undisclosed size in CHF, according to a filing.

MSPEA has invested in three other NBFCs: South Indian SME finance-focused Five Star Business Finance, vehicle financier Kogta, and Jana Small Finance Bank, which has since obtained a banking license. All three companies have received private equity funding in the past 12 months.

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• Topics
• South Asia
• Expansion
• Financials
• India
• Morgan Stanley Private Equity Asia
• NBFCs