HDFC sees biz in education loans

28 March 2010

New Delhi, March 28 HDFC will focus on loans for college education in the next few years, as it sees tremendous potential in the segment.
This was the view expressed by Ms Renu Sud Karnad, Managing Director, Housing Development Finance Corporation (HDFC), in an interview to Business Line.
This thrust will happen through HDFC Credila Financial Services, in which HDFC acquired 41 per cent stake last year. The company specialises in education loans.
?HDFC Credila is a tiny company today. But in the coming years, we want to push education loans through it. We see a good market for loans for college education. We want to use the HDFC expertise to see quick turnaround times,? she said.
Ms Karnad also said that HDFC had no plans, in the coming financial year, to go in for a stake sale in HDFC Bank.
At present, HDFC controls about 23 per cent in HDFC Bank and a little less than 73 per cent in HDFC Standard Life.
?As regards HDFC Bank, we would like not to dilute. We would like to stay where we are. That is why when the bank raises equity, we also put in our money,? she said.
IPO plans On HDFC Standard Life, Ms Karnad said that an initial public offering is on the cards, in about 15 months from now.
?This year we will take a decision on how much to do and exactly when to do. We are also awaiting IRDA guidelines on how to find the embedded value of the company,? she said. FDI cap
There is also an important imponderable on whether foreign direct investment (FDI) in insurance will go up to 49 per cent or not, she added. If the FDI cap does not go up and remains at 26 per cent, foreigners would not want to sell but domestic promoters may have to shed stake in the IPO, she said. On home loans, Ms Karnad said that HDFC was confident of compounded annual growth of 20 per cent in disbursements in the next five years.