The company will offer finance against property at competitive rates
CHENNAI: Even as it is set to undergo a name change following the completion of transaction between the Murugappa group and DBS Bank of Singapore to facilitate their equal partnership in the company, Cholamandalam Investment and Finance Company Ltd. (CIFCL) has signalled its foray into the personal loan product segment with the launch of a pilot product in three cities.
This diversification comes in the wake of a change in the composition of the nine-member board. The reconstituted board will be headed by M. A. Alagappan and will have two nominees from the Murugappa group - M. Anandan and Partho S. Datta. DBS will be represented by Rajan Raju, Susan Ho and Pranam Wahi. All the existing independent directors - R. V. Kanoria, V. P. Mahendra and Ravi Ramu - will continue on the board.
Addressing a press conference here on Friday, Mr. Alagappan said a major objective of the partnership with DBS was to "grow in personal finance in a big way.'' Cholamandalam, he said, would get into the home equity market. Typically, it would aim at those house owners who did not take any loan but required funds to refurbish their houses. Depending on the standing of a client, Cholamandalam would offer finance against property at competitive rates, he added. Though the pilot launch covered Chennai, Bangalore and Coimbatore, the company was hoping for an all-India roll out by April-May. It had targeted a disbursal of Rs. 15 crore under the personal loan portfolio by March this year.
The board of the company, which met on Friday, decided to rename the company as Cholamandalam DBS Finance Ltd. Following this, its subsidiaries, too, would undergo a name change and take DBS as a prefix. DBS and the Murugappa group will hold 37.48 per cent each in the renamed Cholamandalam DBS Finance Ltd. DBS became equal partner by picking up a 20 per cent stake in an open offer to the public and acquiring another 17.48 per cent from Tube Investments of India Ltd.