HUDCO To Focus More On Financing Infrastructure Projects Across States, Says Chairman

Housing & Urban Development Corporation Ltd. plans to extend its focus towards financing infrastructure projects during the next financial year.

The company already has multiple infra projects in the pipeline across states, especially in Telangana, Andhra Pradesh and Maharashtra.

The company will focus more on financing infrastructure projects to enhance its loan book and ensure better growth in the coming quarters, said Chairman and Managing Director Sanjay Kulshrestha in a post-earnings press conference on Friday.

The company's net profit rose 104% year-on-year to Rs 519.19 crore in the quarter ended December, according to an exchange filing. Total income rose 7.6% to Rs 2,022.94 crore during the same period.

As of Dec. 31, the outstanding loans were at Rs 84,424 crore, higher from Rs 79,290 crore a year ago. Meanwhile, the company's net non-performing assets fell to 0.44% from 0.96% during the same quarter last year.

HUDCO is already in talks with the Reserve Bank of India to become an infrastructure finance company and expects to receive approval soon in the coming months.

The company is in talks to support infrastructure and housing projects in Maharashtra through funds of over Rs 30,000 crore. When asked about infrastructure and housing projects in Maharashtra, the chairman said that HUDCO is considering proposals for multi-modal corridor projects in Alibaug and redevelopment projects at Thane.

We are also financing the development with Mumbai Metro and the Samruddhi Expressway, he said. HUDCO will also finance affordable housing projects in Yevatmal and Chandrapur.

Housing will also remain a key area of focus for HUDCO amidst the government's thrust on the development of affordable housing in the latest interim budget. Meanwhile, the management believes that the company will take "some time to prepare" before venturing into the private real estate sector to avoid key risks.

When asked if financing from the private sector will affect the company's low-risk profile, which is largely backed by government projects, the chairman said, "We are working on strengthening our system, capacity building, recruitments and policy framework. So it's not like we will never be doing the private sector, but we will be taking some time to be more prepared so that any stress will not occur.".

The company will focus on three key areas in the next financial year, including reducing the cost of funds, expanding operations across segments, and resolving stressed assets, he said.

The company's board has also approved the proposal to raise the company's borrowing limit to Rs 35,000 crore from Rs 18,000 crore earlier, for funding projects and repayment purposes. HUDCO's borrowings as of Dec. 31 stood at Rs 65,719 crore.

"In order to optimise the cost of borrowings, funds through External Commissioner Borrowings are being explored," Sanjay Kulshrestha said in a press release.

The management doesn't see any major headwinds for the company in the next financial year, despite prevailing uncertainties and geopolitical tensions around the globe.

On Friday, shares of Housing and Urban Development Corporation Ltd. closed 2.6% higher at Rs 203.30 on the National Stock Exchange.