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You are here : IndiaNotes >> Research & Analysis >> Companies >> Dewan Housing Finance Corporation Ltd. >> Research

Dewan Housing Finance Q3FY15: Another Decent Performance; Hold

Nirmal Bang | 24 Jan, 2017  | Follow Author | Add to my Favourites 
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Dewan Housing Finance Corporation Ltd.

CMP: Rs. 274

Target: 333

Recommendation: HOLD

Another Decent Performance

Dewan Housing Finance Ltd. (DHFL) posted decent growth across all parameters with Net Interest Income of Rs. 565.4 Cr up 21.7% YoY from Rs., 464.7 Cr and up 5.5% QoQ Rs. 536 Cr. Due to well controlled operating expenses (up 9.1% YoY) Pre provision profit grew handsomely Rs. 416.7 Cr as against Rs. 328.5 Cr same time last year up 26.9% and Rs. 397.2 Cr QoQ. PAT registered a growth 31.7% YoY at Rs. 244.8 Cr from Rs. 185.9 Cr and Rs. 232.6 Cr (5.2% growth on sequential basis). Overall asset quality was stable with GNPA 0.95% up 1bps from last quarter.

Valuation and Outlook

At CMP, the stock is trading at 1.42x and 1.23x FY17E and FY18E BV and 9.1x and 7.1x FY17E and FY18E Diluted EPS respectively which we believe is attractive when compared to its peers. Return on Equity for FY16 was 15.1% and we believe it will inch up to 17.1%/18.6% in FY17E/FY18E. We recommend HOLD rating on the stock with a target price of Rs. 333 (1.5x FY18E BV) indicating an upside of 22% from current levels.

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510.15 -4.65
510.35 -5.10
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About Nirmal Bang

Founded in 1986 by Nirmal Bang, the Nirmal Bang is recognized as one of the largest retail broking houses in India, providing an array of financial products and services. Their retail and institutional clients have access to products such as equities, derivatives, commodities, currency derivatives, mutual funds, IPOs, insurance, depository services and PMS. The Group is headed by Mr. Dilip Bang and Mr. Kishore Bang.

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Disclaimer: The author has taken due care and caution to compile and analyse the data. The opinions expressed above are only the views of the author, and not a recommendation to buy or sell. Neither the author nor accept any liability whatsoever arising from the use of any of the above contents.

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