Dewan Hsg Fin Q3FY17: Fundamental Analysis - Firstcall India Equity

Firstcall India Equity | May 17, 2016, midnight


SYNOPSIS

  • Dewan Housing Finance Corporation Ltd (DHFL) was founded in 1984 by Late Shri Rajesh Kumar Wadhawan with a vision to provide financial access for Indians to own a home of their own.
  • The company achieved a turnover of Rs. 23655.10 million for the 3rd quarter of the financial year 2016-17 as against Rs. 18843.70 million in the corresponding quarter of the previous year, up by 25.53%.
  • During the 3"d quarter, net profit increased by 31.66% to Rs. 2447.70 million from Rs. 1859.10 million in the corresponding quarter ending of previous year.
  • During the quarter, EBIDTA stood at Rs. 21785.50 million in Q3 FY17 as against Rs. 17070.00 million in the corresponding period of last year, an increase of 27.62%.
  • During the quarter, PBT increased by 32.54% to Rs. 3717.10 million from Rs. 2804.60 million in the corresponding period of the previous year.
  • EPS of the company stood at Rs. 7.82 in Q3 FY17 against Rs. 6.37 in the corresponding quarter of the previous year.
  • Assets Under Management grew 18.70% to Rs 78295810 mn for the quarter ended December 31, 2016.
  • Net Interest Margin stood at 3.07% in Q3 FY17 as compared to 2.87% in Q3 FY16.
  • Net Sales and PAT of the company are expected to grow at a CAGR of 20% each over 2015 to 2018E.


OUTLOOK AND CONCLUSION

  • At the current market price of Rs. 288.05, the stock P/E ratio is at 9.69 x FY17E and 8.10 x FY18E respectively.
  • Earning per share (EPS) of the company for the earnings for FY17E and FY18E is seen at Rs. 29.74 and Rs. 35.57 respectively.
  • Net Sales and PAT of the company are expected to grow at a CAGR of 20% each over 2015 to 2018E.
  • On the basis of EV/EBITDA, the stock trades at 7.40 x for FY17E and 7.12 x for FY18E.
  • Price to Book Value of the stock is expected to be at 1.54 x and 1.30 x for FY17E and FY18E respectively.
  • Hence, we say that, we are Overweight in this particular scrip for Medium to Long term investment.

 

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