HUNDUJA LEYLAND FINANCE

# **Driving Growth and Diversifying Dreams: The Ascendance of Hinduja Leyland Finance**

In the competitive landscape of Indian Non-Banking Financial Companies (NBFCs), few names command as much respect and momentum as **Hinduja Leyland Finance (HLF)**. Established by the global powerhouse **Hinduja Group**, which operates across 10 industry verticals in 100 countries, HLF has evolved from a niche vehicle financier into a **diversified financial services leader** [1-3].

### **A Decade of Exponential Growth**

The numbers tell a story of relentless expansion. As of March 31, 2025, HLF’s consolidated **Assets Under Management (AUM) reached a staggering ₹61,692 Crores**, representing a robust **28% CAGR since FY14** [4-6]. This growth is underpinned by a massive operational footprint, with the company accessible via **1,750+ locations** across 23 states and 2 Union Territories [1, 5, 7].

Financial highlights for FY25 include:

* **Total Revenue:** ₹6,281 Crores [6, 8].

* **Profit After Tax (PAT):** ₹774 Crores (25% CAGR from FY14-25) [6, 9].

* **Asset Quality:** Significant improvement in GNPA to **3.5%** and NNPA to **2.1%** [6, 10].

* **Credit Ratings:** Maintaining a prestigious **AA+ (Stable)** rating from both CARE and CRISIL [6, 8].

### **Diversification: More Than Just Vehicle Finance**

While HLF remains a giant in vehicle finance—with **Ashok Leyland vehicles constituting 23% of its portfolio**—it has successfully balanced its books with cyclical and counter-cyclical products [2, 4, 11].

1. **Asset Finance:** The portfolio is well-spread across **Tractors (22%)**, **Construction Equipment (20%)**, **Medium & Heavy Commercial Vehicles (19%)**, and an increasing focus on the **Used CV market (7%)** [12, 13].

2. **Affordable Housing:** Its subsidiary, **Hinduja Housing Finance (HHF)**, has become a powerhouse in its own right, focusing on first-time home buyers and self-employed individuals in Tier-III/IV locations [14, 15]. HHF closed FY25 with an **AUM of ₹13,820 Crores** and an impressive **Return on Equity (ROE) of 25.8%** [6, 16].

### **The Digital Frontier: Gro and Gaadi Mandi**

HLF is not just lending; it is building ecosystems. Through its new digital initiatives, the company is unlocking value across the entire vehicle ownership lifecycle [17, 18].

* **Gro Digital Platforms:** A freight ecosystem play targeting a **₹15.2 Lakh Crore opportunity** by connecting road transportation and the CV after-market [18, 19].

* **Gaadi Mandi:** A digital marketplace for used vehicles that reduces dependency on brokers and ensures market-driven prices through a transparent auction model [20, 21]. In Q4 FY25 alone, Gaadi Mandi sold **13,797 vehicles** valued at ₹177 Crores [21].

### **The Road to IPO**

For investors, the most exciting development is the anticipated **IPO timeline of 12-18 months** [22, 23]. With a current estimated **market valuation of ₹12.5k Crores** and a valuation metric of 15 P/E, analysts expect significant upside from earnings growth and P/E expansion upon listing [22, 23].

The company is guided by a Board of Directors boasting over **350 years of cumulative experience**, led by Chairman Mr. Dheeraj Hinduja and MD/CEO Mr. Sachin Pillai, ensuring that HLF’s strategic direction remains as solid as its balance sheet [24, 25].

### **Latest News & Market Update**

*(Please note: The following information is based on general market trends and current financial news as of late 2024/early 2025 and is not contained within the provided source documents. You should independently verify these details before publication.)*

* **Monetary Policy Impact:** As the Reserve Bank of India (RBI) maintains a hawkish stance on inflation, NBFCs like HLF are closely watching borrowing costs. However, HLF’s diversified borrowing mix—which includes **70% Term Loans and 19% Securitization**—provides a cushion against sudden interest rate volatility [23].

* **EV Financing Push:** In line with India’s green energy goals, there is a growing market expectation for HLF to expand its "New Business" segment into **Electric Vehicle (EV) financing**, particularly in the three-wheeler and small commercial vehicle segments where they already hold a strong retail presence [12, 17].

* **Housing Sector Tailwinds:** The government's continued focus on "Housing for All" is expected to provide further momentum to Hinduja Housing Finance (HHF), especially in semi-urban areas where HLF already leverages its parent’s existing branch network [15, 16].

**Analogy for Understanding:**

Think of Hinduja Leyland Finance as a **high-performance multi-terrain vehicle**. While its "engine" was built on the solid ground of commercial vehicle financing, its "all-wheel drive" system now allows it to navigate the rugged landscapes of construction equipment, the steady paths of affordable housing, and the fast-paced digital highways of the freight ecosystem—all while maintaining the stability of a world-class balance sheet.