Background: Dewan Housing Finance Corporation (DHFL) promoted by the Wadhwan group, commenced operations in 1984. DHFL with a loan book of INR 214bn is the 3rd largest housing finance company and operates through a network of ~450 outlets. DHFL plans to merge its subsidiary First Blue Home Finance (loan book of INR 63bn) with itself. With this the company straddles across the upper, middle and low income housing segment. In FY12, the company divested a chunk of its stake in DHFL Vysya Housing Finance to the promoters of DHFL. DHFL holds a 40% stake in Aadhar Housing Finance while the promoter group holds a 40% stake and...