Detailed Narrative
Strategic Capital Infusion by IHC
Sammaan Capital announced a significant preferential allotment of ₹8,850 crores to International Holding Company (IHC) via Avenir Investment RSC Limited, securing a 41.2% stake on a fully diluted basis. An additional open offer for 26% could increase IHC's total holding to 63.4%, with the transaction price set at ₹139 per share. This strategic investment, which has received shareholder approval and is pending RBI and CCI clearances, is expected to conclude within the next four months.
Improved Borrowing Profile and Cost of Funds
The announcement of the IHC investment has already positively impacted Sammaan Capital's borrowing profile. The company successfully raised a $450 million dollar bond at a price 150 basis points better than a similar issuance two months prior. Management anticipates an overall reduction in the cost of funds by at least 200 basis points, including a 170 basis points reduction in bank borrowings within a year, which is projected to boost profit after tax by 50%.
Return to Profitability and AUM Growth
Sammaan Capital reported a significant turnaround, achieving a profit of ₹308 crores in Q2 FY26, compared to a loss of ₹2,761 crores in Q2 FY25. The company's net worth increased to ₹22,373 crores, and its Growth AUM reached approximately ₹42,000 crores. While total AUM saw a modest increase of ₹1,000 crores year-on-year, legacy loan AUM declined by ₹9,000 crores, indicating a strategic shift towards retail assets.
Ambitious Disbursal and Branch Expansion Targets
The company aims to significantly scale its operations, targeting an increase in annualized disbursals from the current ₹15,000 crores to ₹35,000 crores by FY27. To support this growth, Sammaan Capital plans a massive expansion of its branch network, aiming for over 500 branches within the next 2-3 years, a three to fourfold increase from current levels. This expansion will be complemented by investments in technology and people.
Evolving Strategy and RoA Improvement
Sammaan Capital is redrawing its strategy in consultation with the new investor, focusing on widening its product suite beyond mortgages to become a general-purpose NBFC. A key objective is to improve Return on Assets (RoA) from the current 1.5% handle to 2.5% handle. The company also confirmed that 100% of its retail originations will continue to be co-lent, direct assigned, or securitized, with a long-term steady income stream from derecognition expected to be around 4% of disbursals.
Regulatory Tailwinds for Co-lending
Recent regulatory changes by SEBI, particularly the second amendment to Listing Obligations and Disclosure Requirements, 2021, have been positive for Sammaan Capital's asset-light strategy. The scope of co-lending has been expanded beyond priority sector to include all loan types and financial institutions like NABARD and HUDCO, with the minimum retention ratio reduced from 20% to 10%, making it more ROA-accretive. The company plans to implement parallel decisioning from December, with guidelines formally kicking in by January.