Centrum Group eyes supply chain division of L&T Finance

The Centrum Group is eying to buy L&T Finance’s supply chain lending arm which has an outstanding loan book of Rs. 800 crore. This move is aligned with L&T Finance’s long-term strategy to reduce its wholesale lending business and focus on high yield retail and housing divisions, going forward.

Both the parties are likely to enter a agreement in the next week, reported a leading English daily. With a continued concentration on retail business, the L&T Finance’s share of rural and housing business increased to 46 per cent as against 35 per cent in last year. Over the medium term, the company’s management expects a balanced product mix, with infra at 40 per cent and rural and housing at 60 per cent.

In terms of RoE of a different division, L&T finance’s rural and housing division has highest return ratio of 26.6 per cent and 23.2 per cent, as against 9.9 per cent from wholesale business.

The stock of Centrum Capital on Thursday’s trading session was trading at positive mark and at 10:30 hours, the stock was trading at Rs. 53.8 per share, up by almost 4.3 per cent from its previous close. Meanwhile, the stock of L&T Finance was trading at negative mark Rs. 184.2 per share, down by 1.1 per cent.