Vastu Housing Finance’s rating has been upgraded to AA-/Stable from A+/Positive by CARE Ratings

National, January 02, 2023: Vastu Housing Finance Corporation Limited and its 100% owned subsidiary Vastu Finserve India Private Limited (Vastu) are amongst country’s leading digitally enabled housing finance focused lenders. Care Ratings Ltd (Care) has upgraded the long-term ratings of both Vastu Housing Finance and Vastu Finserve to “CARE AA-, (double A minus) Outlook: Stable” from “CARE A+, (A plus) Outlook: Positive”.

Excerpts from CARE Ratings rationale – The rating upgrade factors in the improvement in scale up of operation with significant increase in Asset Under Management (consolidated) from Rs.4,412 crore as on September 30, 2022 to around Rs.5,000 crore at the end of December 2022. The ratings also factor in strong profitability, comfortable liquidity profile, experience of the management, strong technology driven processes and risk management systems and well diversified resource profile and profitable operations of the company. The Company has been raising equity capital at regular intervals and well in advance to fund its loan book growth. Its Assets Under Management (AUM) is funded through equity in the initial stages of operations i.e. from FY16 (refers to period from April 01 to March 31) onwards and has low leverage and comfortable capitalization levels. The company had sizeable equity infusion of Rs.925 crore during FY22 which has nearly doubled the tangible net worth of the company. Strong capitalization levels provide the company sufficient room to grow its loan book in the medium term as well as improves the ability to absorb any unforeseen stress in asset quality in the near term.

Commenting on the upgrade, Sandeep Menon – Founder, Managing Director & Chief Executive Officer, Vastu Housing Finance and Vastu Finserve said, “The upgrade in the ratings reflects our consistent all-round performance with a superior profitability track record, strong and consistent asset quality, operational excellence, robust liquidity position and risk management capabilities even through the difficult times. The upgrade will help Vastu, continue with its growth momentum while being future ready and fit for growth. Going forward, we will continue to invest ahead of time in our people, processes, delivery models and technological capabilities to provide seamless and secure experience to all our customers”

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