Neutral PNB Housing Finance; target of Rs 525: Motilal Oswal

Motilal Oswal recommended Neutral rating on PNB Housing Finance with a target price of Rs 525 in its research report dated May 19, 2023.

Broker Research

May 23, 2023 / 11:49 IST

Neutral

26 Aug, 2025 12:21

Volume

Todays L/H

Motilal Oswal's research report on PNB Housing Finance

PNB Housing Finance (PNBHF) reported 4QFY23 PAT growth of 65% YoY to ~INR2.8b (in line), aided by ~120bp QoQ moderation in credit costs to ~1%. FY23 PAT grew 65% YoY to ~INR10.5b. 4QFY23 NII grew 58% YoY to INR5.8b, while PPOP surged 31% YoY to INR4.8b. Asset quality improvement was driven by a fall in both retail and Corporate GNPA. Total GNPA/NNPA ratios stood at ~3.8%/2.8% (% of loan assets) and improved 100bp/50bp QoQ. Retail GNPA improved ~30bp sequentially to 2.6%. Corporate GNPA declined to 22% (PQ: 27%).

Outlook

We expect PNBHF to deliver a CAGR of 12%/22% in loans/PAT over FY23- FY25 and ~1.9%/11% RoA/RoE in FY24. However, we would closely track the execution on loan growth, NIM trend and asset quality before turning constructive on the stock. Maintain Neutral with a TP of INR525 (premised on 0.8x Mar’25E BVPS).

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