TVS Holdings completes acquisition of nearly 81% stake in Home Credit India

CHENNAI: TVS Holdings announced the completion of its acquisition of an 80.74% equity stake in Home Credit India for Rs 554 crore. The remaining 19.26% of the equity stake has been purchased by Premji Invest and other associates of TVS Holdings.

“Given the group’s strength in financial services, there are several areas of synergies to be realised, including collections, cost efficiencies, in-house digital and analytics capabilities, and cross-sell,” said a company statement.

Home Credit India has served more than 1.6 crore customers, both online and offline, and is a leading player in the consumer financing market with assets under management (AUM) of around Rs 5,535 crore as of March 31, 2024.

It has an employee base of 3,800 and a network of more than 50,000 points-of-sale (PoS) spread over 625 cities across India. It focuses on new-to-credit customers, offering consumer durable and personal loans

The company’s investment in real estate business was sold earlier considering its capital-intensive nature and high gestation period of the projects, said the statement.

“The board felt that the proceeds received from sale of the real estate business can be more productively deployed in other core investment. Accordingly, the acquisition of Home Credit was funded through a combination of the proceeds from the recent sale of the company’s real estate assets and borrowings from capital markets, ensuring prudent financial management and capital utilization by TVS Holdings,” said the statement.

Sudarshan Venu, MD, TVS Holdings, said, “The acquisition of Home Credit India marks an important milestone for TVS Holdings. Together with TVS Credit, the group will now have a lending book of around Rs 33,000 crore, taking us closer to our book-size goal of Rs 50,000 crore in the next three years.”

“This acquisition will help the group strengthen its position in the financial services sector, accelerate scale and profitability and build significant value for all stakeholders” said TK Kurien, managing partner and chief investment officer, Premji Invest.