Prabhudas Lilladher's research report on Can Fin Homes
Can Fin Homes (Canfin) has appointed Mr. Suresh Iyer as MD & CEO w.e.f. 18th March, 2023, for a fixed period of 3 years, further extendable for two years. He has 25 years’ experience of working in Gruh Finance across various functions like sales, operations, IT strategy, policy & pricing, risk, recovery, legal etc. MD&CEO appointment is positive as 1) it removes overhang of a key management position lying vacant and 2) increase business focus to aid loan growth. Further credit momentum has been steady with 20% YoY growth. MD&CEO’s commentary on medium term strategy is a key. With increased focus, we expect pace of business to enhance without diluting profitability or asset quality and hence our FY23-25E loan CAGR estimate of 17% may see an upgrade.
Outlook
Our FY23/24/25E PAT remains unchanged and Canfin structural story is intact with likely RoE of ~17.0% over FY23-25E, while valuation at 1.5x is attractive. Rolling forward to FY25ABV, we tweak multiple from 2.1x to 2.0x and keep TP unchanged at Rs700. Retain ‘BUY’.
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.
