Aditya Birla Capital Approves Major Capital Infusion into Housing Finance Arm
In a significant development in the financial sector, the boards of Aditya Birla Capital and Aditya Birla Housing Finance have given their approval for a substantial primary capital infusion into the housing finance subsidiary. The infusion, amounting to Rs 2,750 crore, is set to be channeled through Indriya, an entity associated with global private equity firm Advent International.
Transaction Details and Valuation
This strategic move is aimed at fueling the growth trajectory of the housing finance arm, subject to necessary shareholder and regulatory approvals, along with the fulfillment of customary conditions. The transaction places a post-money valuation of Rs 19,250 crore on the housing finance company, underscoring its robust market position and future potential.
Upon completion of the infusion, the ownership structure will see Aditya Birla Capital retaining a dominant stake of approximately 85.7%, while Advent International will acquire a significant minority holding of around 14.3%. This partnership is expected to leverage Advent's expertise in financial services to accelerate expansion.
Impressive Growth and Asset Quality
The housing finance unit has demonstrated remarkable performance, with its assets under management (AUM) soaring at a compound annual growth rate (CAGR) of 48% over the past three years. As of December 31, 2025, the AUM stood at an impressive Rs 42,204 crore, reflecting strong demand in the housing finance sector.
Asset quality remains a cornerstone of the company's operations, with a gross stage 3 ratio of 0.5% and a net stage 3 ratio of 0.2%. These figures highlight the firm's prudent risk management practices and stable financial health, even amidst rapid growth.
Strategic Utilization of Capital
The primary objective behind this capital infusion is to sustain the current growth momentum and aggressively expand market share. The funds will be deployed to enhance lending capabilities, explore new market segments, and strengthen technological infrastructure, positioning the company for long-term success in a competitive landscape.
This move aligns with broader trends in the Indian financial services industry, where housing finance companies are increasingly seeking strategic investments to capitalize on the growing demand for home loans and related products.
