Burmans pick up strategic stake in DMI Finance

At present, DMI's loan book stands at Rs 500 cr, most of it loans to real estate firms

The Burman family, promoters of Dabur India, has bought a strategic stake in DMI Finance Ltd, a Delhi-based non-banking finance company (NBFC), for an undisclosed sum.

Yuvraj C Singh, joint managing director of DMI Finance, said this investment marks the Burman family’s entry into the secured lending space. Gaurav Burman, son of Dabur India Ltd Chairman Emeritus V C Burman, will join the board of DMI. He, however, declined to elaborate the terms of the deal.

According to Singh, DMI Finance will go in for further capital infusion in the next 12-18 months. He added that the company will commence talks with domestic and foreign investors including family offices for capital. At present, DMI’s loan book stands at Rs 500 crore, most of it loans to real estate firms.

The company plans to ramp up its corporate loan book to Rs 1,500 crore over the next 12-18 months. As business expands, the funding model will go under change. Till now, equity money was used for business growth. Now, it will also tap credit lines from banks to raise resources, said Singh.

Singh and Shivashish Chatterjee, both former senior executives of Citigroup, set up DMI Finance in 2009 as an NBFC specialising in senior-secured lending. DMI has an equity stake in Alchemist Asset Reconstruction Company. It recently received a housing finance company licence from the National Housing Bank.

V C Burman said, “Financial services is one of the key growth areas identified by the Burman family. This sector is poised for rapid expansion over the next few years and we are ready to participate in this growth with several investments in the sector.

Fixed-income financial services in India is a trillion-dollar opportunity, which is growing at more than 25 per cent annually.