LIC Housing Finance Ltd. share price target

LIC Housing Finance (LICHF) is among the top five housing finance companies in India and provides housing loans to individuals and corporate bodies. The company is also engaged in the home equity space. It has an established network of direct selling agents and home loan agents. Loans to individual (including LAP) forms 97.2% of the loan book with the balance coming from project loans (loans to builders).

LIC Housing Finance (LICHF)'s 2QFY17 results remained decent with the PAT growing by 21.3% yoy. Balanced growth in retail as well as in developer portfolio helped in improving the spread, while lower cost of funds helped in NIM improvement. While the core retail portfolio continues to be sluggish growing by less than 10%, other segments l..

Back to a normalized earnings quarter after high credit cost in Q1FY17 Expectedly, LICHF's non-tax provisions normalized and declined QoQ pushing up strongly the net profit growth. The earnings were in-line with estimates with ~19%YoY growth in operating income and ~18%YoY growth in operating profit. It may be noted that loan loss provisions in...

Steady performance; strength in margin to stay PAT was up 20% YoY to | 495 crore vs. estimate of | 453 crore. It was led by lower provisions of | 30 crore vs. estimate of | 93 crore NII growth stayed healthy at 21% YoY to | 866 crore. NIM improved further by 7 bps QoQ to 2.68%. Change in loan mix towards high yielding assets like loan against property (LAP) & developer loans and fall in CoF have enabled rise in margins in the past four quarters...

LICHF's loan book grew (15%YoY, 3%QoQ) to INR 1311bn in 2QFY17. Growth in project loans was healthy at 23%YoY. Home loans to Individual showed a stable growth of 15%YoY. Consequently, the share of individual and project loans stood at 97.2% and 2.8% of the overall portfolio respectively. LAP's share in the overall portfolio has grown by 40bps...

share and almost doubled in last seven years to ~10% currently. The growth has been primarily led by the individual loan book (retail book), which accounts for 97% of the total loan book. Gradually, LICHF has reduced its developer loan book share from 10% in FY10 to 3% currently in order to maintain stable asset...

One off provisions cause Q1 profit miss; retain estimates Additional ageing provisions of Rs920mn on an already recognized corporate NPA caused LICHF's Q1FY17 provisions to balloon 2.6x YoY to Rs1.16bn causing LICHF to miss profit estimates by ~9.8%. But for the one-off provisions, LICHF's Q1FY17 provisions could have declined ~35% QoQ and ~45% YoY and the net profit could have beaten estimates by 3.5%. Nevertheless, the said NPA (under LICHF possession) is now fully provided for with management optimistic about recoveries once the recovery process culminates. In our recent initiation report on LICHF, we had expressed confidence on LICHF's asset quality while...

LIC Housing Finance’s (LICHF) 1QFY17 performance mirrored seasonal weakness, with a sequential degrowth in disbursements, pressure on asset quality and decrease in margins. However,  believe pressure that will persist on margins and growth.LAP and project loans are driving reported growth. Management has renewed focus on the core housing segment, which is showing signs of improvement, but lacks historical traction. The pressure on core spreads suggests heightened competition.With valuations at 1-STD and ~22% premium to the long-term average, plus operating metrics lagging historical peaks, HDFC Securities maintain NEUTRAL. Revise TP to Rs 547 (2.3x Mar-18 ABV of Rs 238).

Trendlyne has 18 reports on LICHSGFIN updated in the last year from 7 brokers with an average target of Rs 571.3. Brokers have a rating for LICHSGFIN with 1 downgrade,5 price upgrades in past 6 months and 1 price downgrades,6 price upgrades in past 1 Year.

yields (8bps qoq to 10.93%) was negated by slightly higher incremental cost of funds (8bpsqoqto8.83%).NIMforthequarterwasat2.71%. Share of highyielding portfolio of LAP and project loans improved to 12.2% (+498bps yoy).ChangeinportfoliotowardshighyieldingloanswillkeepNIMstable....

ICICI Securities Ltd | Retail Equity Research LICHF's operational performance was in line with estimates but PAT was lower (down 9% QoQ to | 408 crore) mainly due to one-time higher-than-expected provisions of | 92 crore on account of ageing of old project loan NPAs, which had already been classified as NPAs NII growth remained strong at 25% YoY to | 825 crore, in line with estimates. Margins were healthy and in line at 2.61% (up 20 bps YoY). A change in loan mix towards high yielding assets like loan...