EDELWEISS group, a financial services firm, has entered into retail housing finance business by launching Edelweiss Housing Finance. The company hopes to capture 20 per cent of the Rs 300,000 crore housing finance market over the next five years, it said in a release.
"The housing finance market is expected to double from Rs 150,000 crore to Rs 300,000 crore by financial year 2015. Edelweiss Capital expects to capture about 2 per cent of the Rs 300,000 crore housing finance market over the next five years," said Anil Kothuri, executive vice-president, Edelweiss.
"The gross domestic product (GDP) per capita is about $3,000 on purchasing power parity basis.
This is the stage at which consumption and retail businesses begin to grow exponentially. This will need to be accompanied by a similar increase in retail lending. Retail financing thus offers one of the largest growth opportunities over the next couple of decades," Kothuri said.
As a first step to addressing this growth opportunity, Edelweiss said it is venturing into the retail housing finance business through Edelweiss Housing Finance (EHFL), a subsidiary.
At present, EHFL is based in Mumbai and plans to extend this reach to Delhi before the end of financial year 2011. In financial year 2012, it plans to venture into eight other metros and mini-metros, which together with Mumbai and Delhi represent about 60 per cent of the housing finance market.
This reach will increase to 20 cities by financial year 2013 and will cover 90 per cent of the country's housing finance market. EHFL 's approach to the housing finance business will be based on offering differentiated products and a superior internet-based sales and fulfillment process for applicants said Kothuri.
"Over 250,000 customers already deal with Edelweiss for investments through our wealth management, brokerage and anagram finance businesses. This gives us a ready pool of customers to tap into," Kothuri said.
