ICICI Securities's research report on India Shelter Finance Corporation
India Shelter (ISFC)’s Q2FY26 financial performance is testament to its business resiliency and niche in the AHFC space. The company has sustained its 17% RoE and flat credit cost QoQ at 50bps (within guided range of 40–50bps in FY26). Gross-stage 3 was flat QoQ at 1.25% and NS 3 at 0.94%, with PCR at 25%. We believe the better-than-industry asset quality performance is due to its lower exposure in stressed states like Tamil Nadu (TN), Gujarat (GJ) and Karnataka (KTK) [6% in each state] coupled with stringent underwriting and robust collection mechanism.
Outlook
We expect a higher proportion of LAP portfolio (40% of AUM), resulting in better spreads than peers and the ~85% of fixed-rate loans (of which 35% is semi-variable) to help ISFC sustain a better RoE figure than peers. Retain BUY with an unchanged TP of INR 1,125, valuing it at 3.5x Sep’26E BVPS.
For all recommendations report, click here
Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
Find the best of Al News in one place, specially curated for you every weekend.
Stay on top of the latest tech trends and biggest startup news.
