CSL Finance: A micro-cap stock to watch

In August 2017, CSL Finance issued preferential shares to top HNIs at ₹390 per share. CSL raises ₹54 crore from the following well known investors:

– Aadi Financial (Akash Bhanshali, co-founder of ENAM)
– Kothari Ventures (Rohit Kothari family)
– Ajay Relan (Co-founder of CX Partners)
– Madhuri Kela (Madhuri is the wife of Madhu Kela)
– Aditya Deepak Parekh (Aditya is the son of Deepak Parekh)

What does the company do?
CSL Finance provides secured loans and bridge financing to small and medium size companies in real estate development, construction finance to builder floor developers and redevelopment sites which are in the last stage of completion. The company currently operates in Delhi and NCR region.

CSL has recently forayed into SME lending space and opened 4 branches in Haryana and NCR region. CSL will focus on offering secured and unsecured retail SME loans in the ticket size of ₹2-25 lacs to unorganized SMEs.

CSL has decided to focus on its core lending business and has discontinued its non-core activities.

Corporate Loans:
– Focused on NCR region
– Loan size at ₹1-15 cr
– Loan for real estate and builder floor projects
– Loan for educational institutions
– Loan against property & business loans

SME Loans:
– Loan size at ₹2-25 lacs
– Education
– Medical
– FMCG Trading Industries

Management:
– Mr. Sandeep Lohani, CEO of CSL, has over 15 years of experience in SME lending
– Mr. Lohani worked as Chief Strategy Officer in Satin Creditcare
– Mr. Lohani held leadership positions in Tata AIG, ITC and L&T
– Mr. Lohani holds an MBA from Jamnalal Bajaj Institute
– Mr. Lohani pursued an executive leadership program in microfinance from Harvard Business School

– Mr. Rajeev Mehra, COO of CSL, has over 18 years of experience in SME lending
– Mr. Mehra was leading the SME segment at Satin Creditcare
– Mr. Mehra spent 14 years with HSBC
– Mr. Mehra holds a PGDBM from Birla Institute of Management

Investors:
Promoters hold 74.79% of the company
HNIs collectively hold 21% of the company

Risks:
– The financial services space in India is highly competitive

Why is it buzzing?

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