Indostar Capital receives funding of Rs 1,225 crore
On Wednesday, non-banking finance company (NBFC), Indostar Capital Finance made an announcement of the primary equity funds of Rs 1,225 crore it raised from Brookfield Business Partners L.P. and its institutional partners.
Brookfield has become a co-promoter in IndoStar with the ability to nominate two board members as part of this new development.
This capital infusion raises Indostar's capital adequacy ratio to nearly 40 per cent, one of the highest amongst all listed NBFCs. IndoStar has assets under management (AUM) of about Rs 10,200 crore. The company is cautious about the immediate near-term, but it is confident of considerably increasing its retail AUMs over the next 18-24 months.
The company is of the opinion that with a secure liquidity position and low leverage of about 1.5x, the company is well-positioned to expedite its retail lending strategy in a challenging market environment. It will also be equipped to use the capital for both organic and inorganic growth.
IndoStar's stock opened higher today at Rs 282 apiece, but it later cooled down and hit an intraday low of Rs 279.