Sharekhan has given Buy recommendation for LIC Housing Finance with a target price of Rs. 505 in its research report issued on May 19, 2022
Sharekhan’s research report on LIC Housing Finance
LIC Housing Finance reported better-than-expected operating performance led by lower credit costs in Q4FY22. NII beat ours and the street’s expectations and was at Rs. 1,637 crore versus our estimate of Rs. 1,498 crore, rising by ~9% y-o-y and ~13% q-o-q. The company posted a PAT of Rs. 1,119 crore versus our estimate of Rs. 793 crore, an increase of 180% y-o-y aided by lower provisions and higher other income. Disbursements fell by 14% y-o-y and was up by 9% q-o-q to Rs. 19,315 crore, primarily driven by growth in individual loans. The company’s asset quality improved with stage-3 NPLs declining by 40 bps q-o-q to 4.64% in Q4FY22.
At CMP, the stock trades at 0.7x/0.6x its FY2023E/FY2024E ABV. We maintain a Buy rating on LICHF with a revised price target of Rs. 505.