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Sun, Feb 7 2021 12:06 IST |
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Recommendation by HDFC Securities
LIC Housing Finance Reduce
Recommendation by HDFC Securities
While LICHF s operating performance was in line with estimates, (PPOP growth at 1.3/3.4%), earnings were ahead of estimates as provisioning continued to undershoot estimates. Over the years, non-core assets have contributed to a bulk of the portfolio growth, resulting in disproportionate risk (already reflecting in high developer NPAs). Furthermore, the company holds negligible provisions on early-bucket stressed assets. Potentially elevated provisions, coupled with stiff competition from banks in LICHF s core business underpin our REDUCE rating (revised target price of INR 381).