Jaipur-based HFC Aavas Financier opened on Tuesday to raise ₹1734 crore for initial public offering despite turmoil in the domestic equity market plunging shares of non-banking financial companies to 40%.
The initial public offering ranged between ₹ 818-821.
Analysts suggested that investors can subscribe to it from a long-term perspective. Although, many investors preferred not to invest in NBFCs owing to the choppy market, reported Business Standard.
The Founder and CEO of Aavas, Sushil Agarwal was confident about his differentiated approached. He said, “Aavas is a differentiated story focusing on granular retail home loan business (average ticket size of under ₹9 lakh) and 100 per cent in-house distribution model with no exposure to builder funding, corporate loans or high-ticket lap or investment properties,”
Sushil did not prefer to comment on the crashing NBFCs but rather he believed that his company has a balanced asset liability management (ALM).
The bearish market condition suggested that NBFCs would find it difficult to borrow owing to fears of the liquidity crisis. The debt obligation of IL&FS along followed by a buzz about DHFL’s paper being sold at a higher yield crashed the market.