Buy Can Fin Homes; target of Rs 910 HDFC Securities

HDFC Securities' research report on Can Fin Homes

Can Fin Homes (CANF) reported sluggish loan growth at ~15% YoY, lower than its guidance of ~18-20%, driven by weak disbursals (-10% YoY), on account of operational distractions from the fraud incidence. Lagged asset re-pricing and a mild softening in the funding environment helped improve NIMs to 3.8% (+32bps sequentially), ~30bps north of its medium-term guidance. Asset quality stayed steady with slippages from the restructured portfolio at 14%, marginally north of the guided range. CANF absorbed the full impact of a fraud incidence with a one-time provision while topping up its management overlay, reflecting in softer PAT growth (+12% YoY).

Outlook

We introduce our FY26E forecasts and moderately trim our FY24 earnings estimates by 4% for the one-time provision; maintain BUY with a revised TP of INR 910 (2.2x Sep-25 ABVPS).

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