IIFL Finance aims to raise around Rs 2 lakh in FY 2024 through various channels such as bank loans, bonds and external commercial borrowings.
The funds raised will be used mainly to repay existing debt from banks. Jain emphasized that the funding strategy is flexible enough to accommodate the company’s diverse liability requirements.
As of March 31, IIFL Finance’s total borrowing amounted to Rs 39.64 billion. His average borrowing cost for fiscal 2023 was 8.8%, and the company expects it to remain at that level this year.
Jain expects disbursements of around 1500-1600 crore this year and targets a net interest margin of 6-7%. The average yield of his portfolio in 2023 was 16.6%.
The company aims to increase its return on assets from 3.3% (as of March 31) to approximately 4% over the next two years. Jain explained that the expansion of the previous branch network has increased the cost-to-income ratio. However, the current focus is not on further expansion, but on improving the productivity of existing branches, thereby lowering the cost-to-income ratio.
IIFL Finance will continue to prioritize gold loans, mortgages, digital business loans and microfinance loans. Jain sees no need to look elsewhere at this time, as these segments alone will allow him to achieve his 25% growth target.
The company is now well capitalized and has no immediate plans for an initial public offering. The company will continue to focus on affordable housing, currently focusing on ticket size Rs 1.5 lakh. Jain said the ticket size may change slightly towards Rs 2 million in the future, but no significant changes are expected.
