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Mahindra & Mahindra Financial Services announced its entry into the mortgage sector with a ₹20-30 crore investment. The company plans to offer housing finance, top-up loans, and lease rental discounting, capitalising on its existing retail lending network.
Mahindra & Mahindra Financial Services Ltd (MMFSL) has announced its foray into the mortgage business with an investment of ₹20-30 crore. The company's board of directors approved the expansion on September 13, 2024. MMFSL's move into the mortgage sector aligns with its broader strategy to diversify its financial services portfolio.
MMFSL’s entry into the mortgage business will encompass several offerings, such as housing finance, top-up loans, lease rental discounting, home improvement loans, home extension loans, balance transfer loans, and construction finance. This expansion will allow MMFSL to tap into India’s growing housing market, catering to both new and existing customers.
The company aims to leverage its well-established retail lending network to strengthen its presence in the mortgage sector. Additionally, MMFSL plans to participate in government schemes, particularly in the affordable housing segment, to further broaden its market reach.
The ₹20-30 crore investment, which includes spending on IT infrastructure, will help MMFSL build the necessary systems and services to support its mortgage business. This strategic expansion is expected to be rolled out over the next 12 months, with a particular focus on growing its market share within the housing finance industry.
Given its existing infrastructure and customer base, MMFSL will focus on cross-selling these new mortgage products to its existing clientele while attracting new customers. By offering a wide range of mortgage products, the company hopes to position itself as a competitive player in the housing finance sector.
MMFSL’s recent financial performance reflects strong growth, with the company reporting a net profit of ₹513 crore for the April-June quarter of FY25, a 45% year-on-year increase. The company's net interest income also rose by 16%, standing at ₹1,894 crore during the same quarter.
This growth provides a solid financial foundation for MMFSL as it embarks on its mortgage venture. As the company expands its portfolio, it will be closely watched by investors, and the M&M share price could see movements in response to the performance of this new business segment.
Mahindra & Mahindra Financial Services’ entry into the mortgage business represents a significant strategic move to broaden its financial services portfolio. The ₹20-30 crore investment marks the company's intent to strengthen its position in the housing finance sector while leveraging its established customer network.
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