Sharekhan has given Buy recommendation for Housing Development Finance Corporation with a target price of Rs. 3589 in its research report issued on Feb 03, 2022

Sharekhan’s research report on Housing Development Finance Corporation

HDFC’s PAT beat street expectations at Rs. 3,261 crore, up 11% y-o-y (but down ~14% q-o-q), led by strong individual loan growth (up by 16% y-o-y). Overall, AUM grew by 12% y-o-y and 4% q-o-q. •We expect all its business segments – individual, corporate, LRD, and construction finance to perform better going ahead. The management sounded optimistic about the strong pipeline for construction finance and LRDs and expects a positive growth in the non- individual book. Credit costs continued to decline, coming in at 7 bps in Q3FY22 versus 9 bps in Q2FY22. NPLs witnessed deterioration on account of revised guidelines of NPA recognition by the RBI.

Outlook

We maintain a Buy rating on HDFC with an unchanged SOTP based PT of Rs. 3,589.

 

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