Moneycontrol

Budget 2021

Associate Partners:

  • SMC
  • Samsung
  • Volvo

Moneycontrol

Budget 2021

Associate Partners:

  • SMCSamsungVolvo
Webinar :Join an expert panel for a webinar on Smart investments for a secure retirement January 28, 2021. Register now!

Reduce LIC Housing Finance; target of Rs 296: HDFC Securities

HDFC Securities recommended reduce rating on LIC Housing Finance with a target price of Rs 296 in its research report dated August 25, 2020.

August 27, 2020 / 02:07 PM IST
 
 
live
  • bselive
  • nselive
Volume
Todays L/H
More

HDFC Securities' research report on LIC Housing Finance


LICHF’s 1QFY21 operating performance was only slightly higher than estimates, but earnings were considerably higher than estimates, on account of lower-than-expected provisions (LLPs and tax). AUM growth was the slowest since FY09, and the moratorium portfolio remained sticky at 25% of loans (77% in the developer book).



Outlook


While we have increased our earnings, we maintain our REDUCE rating with a target price of Rs 296 (0.9xFY22E), especially after the recent run-up. LICHF faces several challenges in the near term: (1) a sticky moratorium book (particularly in the developer book), (2) inadequate coverage with minuscule Stage I & II provisions and negligible COVID-19 related provisions, and (3) stiff competition from banks, which would constrain growth and NIMs.


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.

Broker Research
first published: Aug 27, 2020 02:07 pm

stay updated

Get Daily News on your Browser
Sections