Motilal Oswal - Dewan Housing Finance (DHFL) MOSL: DEWAN HOUSING (Buy)-Growth moderates-sell-downs to be a key strategy going forward

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Motilal Oswal

EUR 120.00 For Business Accounts Only

MOSL: DEWAN HOUSING (Buy)-Growth moderates-sell-downs to be a key strategy going forward

Dewan Housing: Growth moderates; sell-downs to be a key strategy going forward

(DEWH IN, Mkt Cap USD0.9b, CMP INR208, TP INR300, 44% Upside, Buy)

Dewan Housing’s (DEWH) PAT declined 37% YoY to INR3.2b (18% below estimate) in 3QFY19. Over the past quarter, the company focused on liquidity management, while growth took a backseat. DEWH repaid INR179b of borrowings over the past three months, including INR100b of CPs. It raised INR163b of borrowings, largely from portfolio sell-downs.
Hence, the off-BS book now accounts for 24% of AUM v/s 15% in 2QFY19. Management plans to increase this to 35-40% over the next few years.
Due to curtailed disbursements, AUM declined 3% QoQ to INR1.27t.
Management reiterated its priority to reduce the builder loan portfolio share to 5% of AUM by end-FY19. In January 2019, DEWH sold down INR17b of builder loans to an FII via the PTC structure.
Management targets to infuse INR20b of equity capital by March 2019 by means including stake sale in non-core assets.
Asset quality was stable. Gross Stage 3 loans increased 16bp QoQ to 1.12%.

28/01/2019 12 EN

Underlying

Dewan Housing Finance

Dewan Housing Finance Corp. is engaged in the provision of house financing, lease financing and housing development.

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INE202B01012 National Stock Exchange of India India

Provider

Motilal Oswal

Motilal Oswal Financial Services Ltd. is a reputed name in Financial Services and Online Trading with group companies providing services such as Private Wealth Management, Retail Broking and Distribution, Institutional Broking, Asset Management, Investment Banking, Private Equity, Commodity Broking, Currency Broking, Principal Strategies & Home Finance.

Motilal Oswal Securities is a group company of Motilal Oswal Financial Service Limited which started as a stock trading company and has blossomed into well diversified firm offering a range of financial products and services. Motilal Oswal has built a reputation as the source for best stock trading company and this has taken a wealth of experience, knowledge and expertise, constantly working in tandem, over the years.

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MOSL: DEWAN HOUSING (Buy)-Growth moderates-sell-downs to be a key strategy going forward

Monthly LMI Update Independent Investment Research

An unfavourable environment weighs on DEWAN HSG.FIN.CORP.LTD., which sees a downgrade to Negative

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MOSL : HOME FIRST FINANCE COMPANY: Earnings in-line with sustained improvement in asset quality

MOSL : SHOPPERS STOP: Ticking the right boxes

MOSL : ERIS LIFESCIENCES: Enhanced efforts toward product launch-related activities

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