LIC HOUSING FINANCE (IN), a company active in the Real Estate Investment Trusts industry, is favoured by a more supportive environment. The independent financial analyst theScreener has confirmed the fundamental rating of the title, which shows 4 out of 4 stars, as well as its unchanged, moderately risky market behaviour. The title leverages a more favourable environment and raises its general evaluation to Slightly Positive. As of the analysis date March 29, 2022, the closing price was INR 360....
Full Article at IIR has reaffirmed its Recommended rating for PIA after undertaking a review post the appointment of a new Portfolio Manager, Harding Loevner. The full report can be found on the IIR website. On 26 July 2021, Pengana International Equities Limited (PIA) announced a fully franked dividend of 1.35 cents per share for the June quarter. This represents an 8% increase on the March quarter dividend and takes the total dividends declared for FY21 of 5.1 cents per share, fully franked....
LIC HOUSING FINANCE: Miss across the board; asset quality surprises negatively (LICHF IN, Mkt Cap USD2.8b, CMP INR410, TP INR525, 28% Upside, Buy) PAT declined by 81% YoY (78% miss) to INR1.5b in 1QFY22. Higher than estimated finance costs of INR36b led to a 13% miss on our NII estimate. Elevated credit costs of INR8.3b (est. INR4.5b) added to the large PAT miss. Large wage revisions undertaken in 1QFY22 have led to a spike in operating expenses, leading to a weak operating performance (P...
LIC Housing Finance: Asset quality continues to deteriorate; growth moderates (LICHF IN, Mkt Cap USD3.1b, CMP INR440, TP INR530, 20% Upside, Buy) Higher credit cost leads sharp miss on estimates LICHF’s 3QFY20 PAT of INR6.0b missed our estimate by 13% due to challenges on growth and asset quality. AUM growth slowed to 12% YoY from the run-rate of 15-16%, while GNPL ratio jumped 35bp QoQ to 2.73%. More importantly, the spike in NPL was driven by 40bp sequential increase in the individual ...
LIC HOUSING FINANCE: Asset quality pressures remain (LICHF IN, Mkt Cap USD2.7b, CMP INR373, TP INR490, 31% Upside, Buy) 2QFY20 PBT came in at INR8.6b (10% miss) due to higher-than-expected credit costs. It was a better quarter on the business front - home loan disbursements grew 16% YoY to INR101b. LICHF scaled back in LAP and builder loans, resulting in overall disbursements declining 15% YoY to INR122b. For the first time in several quarters, the share of home loans increased sequentially...
Q2FY20 results highlights LICHF’s PAT of Rs7.7bn grew 26% qoq / 35% yoy beating the consensus estimate by a wide margin. The beat was largely on account of lower taxation. While the company has taken full benefit of a lower tax rate for 1H, it has not marked down deferred tax assets, which has led to a lower than expected tax rate of 10% for the quarter. Operating performance was weak on many counts 1) GNPAs rose sharply in both retail and developer loans 2) The proportion of variable loans d...
Q1FY20 result highlights LICHF’s PAT of Rs6.1bn grew 8% yoy but was lower than our estimate of Rs6.7bn. The miss was on account of a sharp increase in credit cost. Total disbursals grew 7% yoy with retail growing 8% (lower than 10% in 4Q) and developer disbursals declining 7%. Within retail, both core and non-core grew at 8%. Loans grew 17% yoy with retail growing 15% and developer loans growing 62%. Core retail loans grew 13% yoy while LAP grew 24%. Affordable housing accounts for 21% of di...
LIC Housing Finance: Asset quality pressures in wholesale book; cut estimates by 4-5% (LICHF IN, Mkt Cap USD3.5b, CMP INR496, TP INR580, 17% Upside, Buy) LICHF reported 1QFY20 PAT of INR6.1b, 8% below our estimate, driven by higher-than-expected credit costs. Asset quality deteriorated meaningfully in the quarter - the gross stage 3 ratio increased 40bp QoQ/80bp YoY to 2.0%, driven by ~INR7b slippages in corporate loans from three large accounts. PCR declined 500bp QoQ to 45%. Note that ...
Q4FY19 result highlights While LICHF’s PAT beat ours and consensus estimates by a wide margin, both retail and developer asset quality disappointed. Retail NPLs rose sharply by 31% qoq in a quarter that is seasonally very good for retail recoveries. Developer NPLs also rose sharply by 28% qoq. Total NPLs rose 30% qoq to 1.53% from 1.26% qoq. Within retail, while LAP NPLs have remained stable at 1.4%, core retail NPLs have grown from 0.76% to 0.94% yoy. There is no segment or geographic bias ...
LIC Housing Finance: Margins surprise positively; Asset quality under pressure (LICHF IN, Mkt Cap USD3.5b, CMP INR485, TP INR580, 19% Upside, Buy) 4QFY19 PAT increased 17% YoY to INR5.7b (3% beat), driven by better-than-expected margins and lower credit costs, despite a sharp rise in NPAs (+30% QoQ). Loans grew 6% QoQ and 16% YoY to INR1.95t with core home loan growth of 10% YoY and 5% QoQ to INR1.48t. Share of builder loan portfolio increased to 6.7% v/s 6.2% a quarter ago and 4.9% a y...
LIC Housing Finance: Steady performance in a tough environment; Liquidity position well managed; Balance transfer pressure softens (LICHF IN, Mkt Cap USD3.7b, CMP INR512, TP INR600, 17% Upside, Buy) Our strategist recently increased the weightage of LIC Housing Finance (LICHF) in our model portfolio. In our view, after a span of two years, the business environment is turning favorable for LICHF. With liquidity tightening, we expect players with stronger parentage to disproportionately ben...
Q3FY19 results highlights LIC Housing reported strong earnings in a weak environment. PAT of Rs5.96bn was higher than our estimate of Rs5.5bn driven by stable margins and strong AUM growth. PAT grew 26% yoy and 4% qoq. NIM remained flat qoq and yoy which is a good achievement given the liquidity crunch for NBFCs. We believe this was because of lending rate hikes which offset higher cost of funds and increase in the proportion of higher yielding developer loans Disbursement growth remained ...
LIC Housing Finance: Sluggish quarter on the business front; PAT in line (LICHF IN, Mkt Cap USD3.2b, CMP INR449, TP INR550, 22% Upside, Buy) LIC Housing Finance’s (LICHF) 3QFY19 PAT increased 26% YoY to INR5.7b (in-line), driven by stable loan growth and low base of last year. Surprisingly, business was impacted due to the liquidity crisis. Individual disbursements (incl. LAP) were up only 2% YoY to INR115b in the quarter, while corporate disbursements increased 27% YoY to INR12b. Loan...
LIC Housing Finance: Beneficiary of a tight liquidity environment; Moderating competition to lead to better growth and spreads (LICHF IN, Mkt Cap USD3.3b, CMP INR462, TP INR550, 19% Upside, Buy) We believe the business environment for LIC Housing Finance (LICHF) is turning favorable. With tightening liquidity and rising cost of funds, we expect a shake-up in the system, resulting in changing competitive dynamics going forward. Smaller players with lower credit ratings will not be as com...
Q2FY19 results highlights LICHF’s PAT of Rs5.7bn was lower than our estimate of Rs6.3bn due to a sharp increase in ECL based provisions. PAT grew 11% yoy and 1% qoq. Disbursement growth shot up to 30% yoy and 49% qoq the strongest in many quarters. While individual disbursals grew 9% qoq, developer disbursals grew strongly at 384% yoy and 231% qoq. Even within individual disbursals, growth in LAP was 171% yoy while growth in core retail was subdued at 6.7% yoy. Loan growth was healthy at 16...
LIC Housing Finance: Share of non-core loans on the rise; Liquidity situation fine (LICHF IN, Mkt Cap USD2.8b, CMP INR406, TP INR550, 35% Upside, Buy) LIC Housing Finance’s (LICHF) PAT increased 12% YoY to INR5.7b (9% miss), driven by stable loan growth but higher-than-expected provisions. Loan book grew 16% YoY to INR1.76t. However, non-core loans continue driving overall loan growth. Retail home loan growth was 3% QoQ/9.3% YoY. It’s interesting to note that builder loan disbursements ...
LIC Housing Finance: Parentage and access to debt capital key moats; Minimal downside risks to earnings; Valuations attractive at 1.3x FY20 PB (LICHF IN, Mkt Cap USD2.8b, CMP INR431, TP INR550, 28% Upside, Upgrade to Buy) Post the 4QFY17 results, we had downgraded LIC Housing Finance (LICHF) to Neutral citing concerns on rising share of non-core home loans, modest core home loan growth vis-à-vis peers, risk to spreads and rich valuations. Over the past 5-6 quarters, we believe our thesi...
Q1FY19 result highlights PAT of Rs5.7bn was in line and grew 18% yoy. However, earnings mix was weak led by weak retail loan growth, margin pressure and higher NPLs in the developer segment. Individual disbursement growth was only 5% yoy, lowest since 1Q15. Individual loans grew 13% yoy and 1% qoq. Within individual loans, core retail growth was slow at 9% yoy / 1% qoq while LAP continued to grow strongly at 42% yoy / 13% qoq. Developer loan growth remained strong at 49% yoy /4% qoq. Loan re...
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