Buy Can Fin Homes; target of Rs 720: Sharekhan

Sharekhan is bullish on Can Fin Homes has recommended buy rating on the stock with a target price of Rs 720 in its research report dated April 28, 2023.

Broker Research

May 03, 2023 / 12:56 IST

Buy

Sharekhan's research report on Can Fin Homes

Can Fin Homes reported beat in earnings mainly due to lower tax rate with PAT at Rs. 166 crore up 35% y-o-y /9% q-o-q. NIMs (cal. as % of Avg. loans) remained stable q-o-q at 3.4% which was a key positive. Management guided that NIMs for FY24 is expected to around 3.5% led by further repricing of the asset book along with higher disbursement yields offsetting limited increase in cost of funds as interest rate cycle is close to its peak. Loan growth remained healthy at 18% y-o-y while disbursements grew by 8% in FY23. Company guided that there has been moderation in demand in mortgage segment. It believes that as interest rates stabilises in H1FY24, demand is expected to pick up in H2FY24.

Outlook

At the CMP, the stock trades at 1.9x/ 1.6x of FY2024E/ FY20215 ABV estimates. We maintain Buy rating on the stock with a revised PT of Rs. 720. Interest rate cycle close to its peak, is a tailwind for the company.

For all recommendations report, click here