LIC Housing Finance |
Structurally strong story continues |
ACCUMULATE
CMP: Rs 1,458 Target Price: Rs 1,490
n LICHF reported strong 63% growth in NII at Rs3.1bn driven by 36% growth in advances and 35bps expansion in spreads. Stable spreads/NIMs are positive surprise
n The growth in sanctions to individuals remained strong at 28% yoy, although the D/S ratio was lower at 67% due to as LICHF funded mostly under construction properties
n The asset profile improved as the gross NPAs were down by 22% yoy and net NPAs were down 54% yoy. The gross and net NPAs stood at 0.7% and 0.1% respectively
n Valuations at 2.7x FY12E ABV look expensive in short term. However, strong balance sheet, earnings growth keep long term story intact. Maintain ACCUM with 18-mth TP of Rs1490
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