LIC Housing Finance Ltd. share price target

LICHF’s 4QFY25 PAT grew ~25% YoY to ~INR13.7b (~7% beat). FY25 PAT grew ~14% YoY to INR54.3b. 4Q NII declined ~3% YoY to ~INR21.7b (~6% beat).

LICHF saw a good quarter as PAT was a 7.2% beat since (1) NII was 8.5% ahead due to 16bps QoQ increase in NIM driven by reduction in funding cost and (2) provisions were lower due to 28bps QoQ reduction in stage-3 to 2.5%. Reported NIM for FY25 was 2.7% (3.1% in FY24) and despite likely repo cut of 75-100bps company sees NIM for FY26 to range between 2.6-2.8% as PLR would be trimmed only after repo cut translates to lower funding cost. However, we are factoring a NIM of 2.55% in FY26 given increased competition from banks in a falling rate...

LICHF’s 3QFY25 PAT grew ~23% YoY to ~INR14.3b (~12% beat). NII declined ~5% YoY to ~INR20b (in line).

LICHF's 1QFY25 PAT declined ~2% YoY to ~INR13b (in line). NII declined ~10% YoY to ~INR19.9b (8% miss).

Individual home loan disbursement improved in Q4FY24 after a decline in the past five quarters. Moreover, recently announced measure of additional 3 crore house construction under PMAY scheme is potentially positive

LIC Housing Finance’s (LICHF) Q2FY24 financial performance appears subdued as reflected in 10% QoQ decline in PAT. The management has been able to hold better-than-guided profitability with RoA sustaining at 1.7% vs guidance level of 1.3-1.4% in FY24.

LIC Housing Finance (LICHF) reported a strong 12% QoQ growth in its Q1FY24 PAT at INR 13.2bn – largely driven by robust 11% QoQ NII growth. NII growth was led by NIM expansion of 28bps QoQ and supported by: 1) the cumulative PLR hikes by 210bps during FY23, followed by another hike of 25bps in Q1FY24, and 2) by superior liability management with 50% of the liabilities being at fixed rate.

LIC Housing Finance’s (LICHF) Q3FY23 performance was a mixed bag – with the much-awaited NIM expansion of 62bps QoQ to 2.42%, but surprising 27bps QoQ rise in credit cost to 1.15%. Higher provisions at Rs7.6bn during Q3FY23 (Rs5.7bn QoQ) was driven mainly by management intent to improve the coverage ratio on stage-3 assets.