LIC Housing Finance Ltd. share price target

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...

LIC Housing Finance’s (LICHF) 1QFY17 net profit grew 6.7% YoY to INR4.1b, (8% miss). While net income was in line with estimates, higher one-off provision of INR920m due to ageing corporate accounts and one-off provision of INR300m in opex led to lower-than-expected PAT.Loan growth of 15.4% YoY (+1.8% QoQ) was led by non-core assets. While retail mortgage grew 9% YoY and 1% QoQ, LAP book growth stood at +100% YoY due to a lower base and continued traction in the segment, and the share of LAP stood 9.3% (+50bp QoQ). Developer loans grew at a healthy rate of +38%, with their share in overall loans increasing to 2.95% from 2.45% in the year-ago period. Overall disbursements grew 23% YoY to INR75.4b. Motilal Oswal largely maintain their estimates; the stock is trading at 2.1x FY18 BV,upgraded TP to Rs 627 and Maintain Buy.

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 and 6 price upgrades in past 1 Year.

LICHF loan book grew (15.4%YoY, 1.8%QoQ) to INR 1274bn in 1QFY17 led by growth in individual loan portfolio (14.9%YoY, 1.7%QoQ) and project loans (36.6%YoY, 7.4%QoQ). Consequently, the share of individual and project loans stood at 97.1% and 2.9% of the overall portfolio respectively. LAP's share in the overall portfolio has grown by 50bps and is...

LICHF loan book grew (15.2%YoY, 6.5%QoQ) to INR 1251bn in 4QFY16 led by growth in individual loan portfolio (15.2%YoY, 6.5%QoQ) and project loans (26%YoY, 11.4%QoQ). Consequently, the share of individual and project loans stood at 97.3% and 2.7% of the overall portfolio respectively. LAP's share in the...

LICHFs NII met expectations, driven by a 19-quarter-high NIM (2.7%, 13bps QoQ) and steady book growth. However, rising competition led to multi-quarter high repayments, even as disbursals grew 57% QoQ. Rising proportion of high-yielding LAP and project finance (along with the decline in CoF), supported NIM. Asset quality improvement was a seasonal phenomenon.

LIC Housing Finance's (LICHF) 4QFY16 net profit grew 18% YoY to INR4.48b (7% miss). While the spreads and margins improved by 33/23bps YoY; lower than expected loan growth of 15.5% (led by higher repayments) coupled with higher...

Valuation: The stock is currently trading at P/BV of 1.7X, P/E of 9.1X FY18E. Strong traction in loan book growth and healthy asset quality are amongst the key positives. With, wholesale rates benign, LICHF will be a key beneficiary. We maintain the target price at INR 574/share implying a P/BV of 2.3X on FY17E. We rate the stock an OUTPERFORMER....

For 3QFY2016, LIC Housing Finance (LICHF) reported an earnings growth of 21.7% yoy with healthy growth of 35.0% yoy in net interest income, led by healthy growth in advances and stable margins. NII rises yoy; Impressive NIMs LICHFs loan book grew at a healthy pace of 15.2% yoy to Rs1,17,396cr during 3QFY2016. The individual portfolio, which constitutes 97% of the total loan book, grew by 15% yoy. Loans to the developer segment, which saw a reversal trend from the past quarter, continued its upward momentum growing by 20% yoy to Rs3,091cr. Total disbursements growth was of ~10% yoy. Margins during the quarter were at 2.58% as compared to 2.20% in the corresponding quarter of the previous year. A significant decline in the cost of funds to 9.18% as compared to 9.59% in the corresponding previous year period along with increase in floating rate loans to 40% of the total loan portfolio aided the company in registering a healthy growth in the NIM by 38bp yoy to 2.58%. On the asset quality front, the Gross NPA ratio came in at 0.58% which declined by 2bp qoq, whereas the Net NPA ratio was stable at 0.32%. Provisions rose to Rs34.4cr compared to...