Buy Can Fin Homes; target of Rs 930: Prabhudas Lilladher

Prabhudas Lilladher is bullish on Can Fin Homes has recommended buy rating on the stock with a target price of Rs 930 in its research report dated July 23, 2024.

Broker Research

July 23, 2024 / 12:12 IST

Buy

26 Aug, 2025 12:21

Volume

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Prabhudas Lilladher's research report on Can Fin Homes

CANF saw a weak quarter since (1) disbursals at Rs18.5bn were 13% lower to PLe, (2) reported NIM fell by 16bps QoQ due to rise in cost of funds and (3) provisions spiked QoQ. As per the company, disbursals were affected owing to the general elections and seasonality. However, credit flow touched Rs8bn in Jun’24 and CANF expects disbursals of Rs25bn in Q2FY25 and Rs105bn in FY25, which would translate to 15% YoY AuM growth in FY25. We trim loan CAGR over FY24-26E by 1% to 14% due to competition from banks and larger HFCs. If a scheme similar to CLSS is introduced in the upcoming budget, loan growth could be positively impacted by 2-3%. We cut NIM for FY26E by 10bps due to likely repo rate cuts in FY25/FY26 and increased competition given the focus on growth.

Outlook

We trim PAT for FY26E by 5%. Tweaking multiple to 2.1x from 2.2x on Mar’26 ABV, we reduce TP to Rs930 from Rs950. Retain ‘BUY’.

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