Sharekhan has given Buy recommendation for Housing Development Finance Corporation with a target price of Rs. 3100 in its research report issued on Feb 02, 2021
Sharekhan’s research report on Housing Development Finance Corporation
Q3FY2021 results were strong as operational numbers beat expectations; asset quality improved sequentially and growth traction improved. Overall collection efficiency for individual loans stood at 97.6 in December (from 96.3% in September) which is encouraging. Asset quality improved with reported NPA ratio declining, proforma NPA well-contained, company is better capitalised (Tier-I at 19.9%) which demonstrates balance sheet strength.
Stock trades at reasonable valuations of 4.8x / 4.4x its FY2022E / FY2023E ABV; we maintain a Buy with a revised SOTP based price target (PT) of Rs. 3,100.
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