Poonawalla Fincorp to keep headcount at 3,000 for 5 yrs to build AUM

Eyes Rs 50,000 crore AUM by FY27, up from Rs 16,000 cr currently

After pruning branches and headcount almost by half in FY23, Poonawalla Fincorp Ltd will maintain the branch base at the 100-110 level and headcount at around 3,000 in order to attain an AUM (assets under management) of over Rs 50,000 crore by FY27. At present its AUM is Rs 16,000 crore.

Abhay Bhutada, Managing Director, Poonawalla Fincorp, said the staff strength was 5,184 at the end of March 2022 and stood at 2,452 at end of March 2023, including those serving notice period. These are people who are on roll and another 600-700 are off-roll. It closed 200 branches to bring down network strength to 100.

Going forward, the employee base will remain about 3,000, including off-roll for five years. Three will not be any change in approach as all new offerings would be digital offering and on cross sales.

As for the pace of growth in AUM, Bhutada said it is estimated at 35-40 per cent per year and this year (FY23), the company expects to cross Rs 23,000 crore mark. This assessment is on a standalone basis.

Earlier the firm used to make estimates on a consolidated basis, including housing finance business. In December 2022, it inked a pact to sell the housing finance unit to private equity player TPG Group at a valuation of Rs 3,900 crore. The Reserve Bank of India’s approval is expected in another month or two.

While it may maintain the employee count and the number of branches at the current level, it would continue to make investments to ramp up digital platforms and infrastructure.

The operating expenditure was around Rs 800 crore in FY23 and this year also it will be around the same level. Then it would grow by 15-20 per cent, Bhutada said.

The ratio of opex to AUM was 6.1 per cent in FY23 and would be around 4.1 per cent in FY24.