25 June 2024 Punjab Khabarnama : The company is confident of recouping growth as most of the internal systems and processes have been streamlined. It is guiding for loan growth of 15% in FY25 and 18-20% from FY26 onward driven by pick up in disbursements growth led by branch expansion and productivity underwriting higher ticket-size home loans as demand is tepid in ticket size lower than Rs. 20 lakh and c) Partnering with builders where projects are approved project financial (APF) by other large lenders so that it can source small-project loans. However, focus is mainly on retail home loans and not aggressively looking at other segment – LAP, construction finance etc.
Outlook
At CMP, the stock trades at 2.3x/2.0x its FY2025E/FY2026E ABV. We remain assertive on real estate volumes for housing finance companies in the salaried and prime/mid segment. We expect steady mid-to-high teen growth in this segment to continue. Smaller HFCs are clocking high growth by penetrating newer regions. Inadequate internal controls and systems have impacted the business in the recent times but now most IT systems and processes have been streamlined which should help business to grow with all due diligence. Moreover, the interest rate cycle is closer to its peak, which could act as a growth tailwinds.