Housing Development Finance Corporation

Housing Development Finance Corporation Limited (HDFC) is an Indian financial services company based in Mumbai, India.[3][4] It is a major provider of finance for housing in India. It also has a presence in banking, life and general insurance, asset management, venture capital, realty, education, deposits and education loans.[3]

Housing Development Finance Corporation Limited
Public
Traded asBSE: 500010
NSE: HDFC
BSE SENSEX Constituent
CNX Nifty Constituent
ISININE001A01036 
IndustryFinancial services
Founded1977 (1977)
HeadquartersMumbai, Maharashtra, India
Area served
India
Key people
ProductsMortgage Loans
Revenue ₹96,194 crore (US$13 billion) (2019)[2]
₹22,098 crore (US$3.1 billion) (2019)[2]
₹17,662 crore (US$2.5 billion) (2019)[2]
Total assets ₹660,875 crore (US$93 billion) (2019)[2]
Total equity ₹117,978 crore (US$17 billion) (2019)[2]
Number of employees
2,840 (2019)[2]
Websitewww.hdfc.com

History

It was founded in 1977 as the first specialised mortgage company in India.[5] HDFC was promoted by the Industrial Credit and Investment Corporation of India (ICICI).[6] Hasmukhbhai Parekh played a key role in the foundation of this company.
In 2000, HDFC Asset Management company launched its mutual fund schemes.[6] In the same year, IRDA granted registration to HDFC Standard Life Insurance, as the first private sector life insurance company in India.

Products and services

Mortgage

The COMPANY provides housing finance to individuals and corporates for purchase/construction of residential houses.[7] It is one of the largest providers of housing loans in India.[7] In its Annual Report for financial year 2012–13, the company has disclosed that it has disbursed approx. INR 456,000 crores in 35 years of its existence for a total of 4.4 million housing units.[1]
The average loan profile amounts to INR 2.18 million (US$35,160) which lasts for about 13 years and covers approx. 65% of actual property value.

Life insurance

The COMPANY has been providing life insurance since the year 2000, through its subsidiary HDFC Standard Life Insurance company Limited. It offers 33 individual products and 8 group products. It uses the HDFC group network to cross sell by offering customized products. It operates out of 451 offices across India serving over 965 locations. It had a market share of 4.6% of life insurance business in India as of 30 September 2013.[5] HDFC Life has over 15,000 employees.[8]

General insurance

The company offers general insurance products such as:

  • Motor, health, travel, home and personal accident in the retail segment which accounts for 47% of its total business and
  • Property, marine, aviation and liability insurance in the corporate segment[5]

Mutual funds

HDFC provides mutual fund services through its subsidiary HDFC Asset Management Company Limited. The average Assets Under Management (AUM) of HDFC Mutual Fund for the quarter Jul-13 to Sep-13 was INR 1.03 trillion.[9]

Operations

HDFC's distribution network spans 396 outlets (including 109 offices of HDFC's distribution company HDFC Sales Private Limited) which cater to approx. 2,400 towns and cities spread across India.[3] To cater to Non-Resident Indians, HDFC has offices in London, Singapore and Dubai and service associates in Middle East countries.[3]
In addition, HDFC covers over 90 locations through its outreach programmes. HDFC's marketing efforts continue to be concentrated on developing a stronger distribution network. Home loans are also sourced through HDFC Sales, HDFC Bank Limited and other third party Direct selling Agents (DSA). The corporation has 232 institutional owners and shareholders filing through 13D/G or 13F forms with the Securities Exchange Commission.[10] Largest investor amongst them is Vanguard International Growth Fund.[11]

Major subsidiaries and associates

HDFC's key associate and subsidiary companies include HDFC Bank Limited, HDFC Standard Life Insurance Company Limited, HDFC ERGO General Insurance Company Limited, HDFC Asset Management Company Limited, GRUH Finance, HDFC Venture Capital Limited, HDFC RED and Credila Financial Services Private Limited.[5]

HDFC Bank

HDFC holds 26.14% of shares in HDFC Bank. HDFC Bank sources home loans for HDFC for a fee.[12]
The key business areas of HDFC bank are wholesale and retail banking and treasury operations. On 31 March 2013, its market capitalisation was INR 1.5 trillion (US$27.31 billion), making it India's seventh largest publicly traded company.[13]

HDFC Standard Life Insurance Company Limited

HDFC holds approx. 51.7% of shares in HDFC Life. Standard Life holds 49% shares as per latest Financial Statements. In September 2013, it was ranked third in terms of market share of private life insurance companies in India.[5] On the same date, it had a network of approx. 72,000 financial consultants to sell its policies.[5]

HDFC Asset Management Company

HDFC formed this Mutual fund company with Standard Life Investments and holds approx. 57.4% of its shares. It manages 44 schemes comprising debt, equity, exchange traded fund and fund of fund schemes.[5] Average assets under management (AUM) as at the end of September 2013 were INR 1.07 trillion.[5] It is ranked first in the industry in India on the basis of Average Assets under management.[5]

HDFC ERGO General Insurance Company

HDFC formed this General Insurance company with ERGO Insurance Group. HDFC holds 50.5% and ERGO holds 26% of the shares. By the end of September 2013, its Market share in General Insurance stood at 4.1% (overall) in terms of gross gross direct premium in first half year of FY 2013–14.[5] The total employee strength of the company as of March 31, 2013 was 1,389.[8]

GRUH Finance

HDFC holds approx. 59% in GRUH. It is a housing finance company offering loans to individuals for purchase, construction and renovation of dwelling units. It also offers loans to the self-employed segment where formal income proofs are not available.[5] It has a retail network of 136 offices across 7 states in India.[5]

HDFC Property Fund

It was launched in 2005. Its first scheme was a close ended fund for domestic investors: 'HDFC India Real Estate Fund'. The funds of this scheme are managed by HDFC Venture Capital Limited. Its another scheme is for international investors and is a closed ended fund: 'HIREF International Fund'.[5]

HDFC RED

Launched in 2010, HDFC has 100% shares for HDFC RED, a real estate online listings platform operating under HDFC Developers Ltd. The company focuses on real estate, avoiding resale and rental services.[14][5]

HDFC Credila Financial Services

HDFC Credila is a non-banking finance company and was the first Indian lender to exclusively focus on education loans.[15] The company lends to under-graduate and post-graduate students studying in India or abroad. HDFC holds approx. 90% shares in this company. The average amount of education loan disbursed is INR 880,000 approx.[5]

Listings and shareholding

Listing: The equity shares of HDFC are listed on Bombay Stock Exchange where it is a constituent of the BSE SENSEX index,[16] and the National Stock Exchange of India where it is a constituent of the S&P CNX Nifty.[17]

Shareholding: On 30 September 2013, 73.09% of the equity shares of the company were owned by the Foreign Institutional Investors (FII). Around 185,000 individual public shareholders own approx. 9.25% of its shares. The remaining 17.66% shares are owned by others.[18]

Shareholders (as of 30-September-2013)Shareholding[18]
Promoter Group00.00%
Foreign Institutional Investors (FII)73.09%
Individual shareholders09.25%
Insurance companies08.42%
Mutual Funds/UTI03.04%
Corporate Bodies02.77%
Financial Institutions/Banks02.11%
NRI/OCB/FDI/Others01.32%
Total100.0%

Employees

As of 31 March 2013, the company had 1,833 employees, out of which 22% were women.[7] The company incurred INR 5.28 billion on employee benefit expenses for the financial year 2012–13.[1]
For FY 2012–13, the company reported a per employee profit of US$484,000 and per employee assets of US$18.5 million.[5]
HDFC's Training Centre is located in Lonavla Mumbai and it was established in 1989. It is mainly used for training programmes, workshops, conferences and strategy meetings.[19]

Awards and recognition
  • In 2013, a survey on "India's Best Boards" listed HDFC's Board of Directors among the 5 best boards in India.[4][20]
  • In May 2013, Forbes listed it at #561 in the Global 2000 list of largest companies.[21]
  • In 2012, HDFC Limited was recognised as one of India's 'Best Companies to work for' in a joint study conducted by The Economic Times and 'The Great Place to Work Institute'.[22]

See also

References
  1. "Annual Report 2012-13" (PDF). HDFC. Retrieved 20 November 2013.
  2. Housing Development Finance Corporation Annual Report 2019
  3. "About HDFC". HDFC. Retrieved 19 November 2013.
  4. "India's Best Boards 2013: HDFC distinguished by the fact that it has no promoter". Economic Times. 26 July 2013. Retrieved 27 November 2013.
  5. "Investor Presentations: Quarter Ended March, 2017" (PDF). HDFC Limited. 17 May 2017. Retrieved 20 May 2017.
  6. "Company History - Housing Development Finance Corporation Ltd". Economic Times. Retrieved 27 November 2013.
  7. "Business Responsibility Report 2012-13" (PDF). HDFC. Retrieved 20 November 2013.
  8. "Annual Report of Subsidiaries for FY 2012-13" (PDF). HDFC. Retrieved 27 November 2013.
  9. "Average AUM". Association of Mutual Funds in India. Retrieved 8 December 2013.
  10. "FY Report 2019 : HDFC" (PDF). Retrieved 2 May 2020.
  11. "HDFC Institutional Ownership - HOUSING DEVELOPMENT FINANCE CORP.LTD. Stock". fintel.io. Retrieved 2 May 2020.
  12. "Investor Presentations: Quarter Ended March, 2013" (PDF). HDFC. Retrieved 27 November 2013.
  13. "Table 4-12: Top '50' Companies by Market Capitalisation as of March 31, 2013". NSE India. 31 March 2013. Retrieved 9 November 2013.
  14. "Burning cash on advertising isn't a wise strategy for housing portals: HDFC RED CEO Sohel IS". Forbes. 7 April 2017. Retrieved 20 May 2017.
  15. "HDFC Credila Education Loan".
  16. "Scripwise Weightages in S&P BSE SENSEX". BSE India. Retrieved 16 November 2013.
  17. "Download List of CNX Nifty stocks (.csv)". NSE India. Retrieved 16 November 2013.
  18. "Shareholding pattern". HDFC Limited. 30 September 2013. Retrieved 16 November 2013.
  19. "HDFC Training Centre". HDFC. Retrieved 27 November 2013.
  20. "India's Best Boards 2013: Kumar Birla-led jury finds only five winners". Economic Times. 26 July 2013. Retrieved 27 November 2013.
  21. "HDFC on the Forbes Global 2000 list". Forbes. May 2013. Retrieved 27 November 2013.
  22. "Best companies to work for 2012". Economic Times. 16 July 2012. Retrieved 20 November 2013.
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