Housing Finance Companies: रैली करेंगे या गिरेंगे Whare are the growth perspectives?
Which are the best?
Which should be avoided?
Fundamentals and charts?
Housing Finance:
(3 Major companies HDFC, Canfin & PNBHsgfin latest results has been Updated)
Housing Finance Industry is growing with the CAGR of 20% since last 2 decades. Urbanisation in India is still to happen and it gives wide opportunity for the Home Finance companies in Urban Poor segment along with Mission 2022 “Housing For All”. Currently there is liquidity crunch which has decreased the margins of companies but overall good demand is to be seen. Margins of the majority of the companies are good at around 17%.
Total Housing credit was around 20 lakh credit. There are 83 Housing Finance Companies in India. 90% Housing Finance is controlled by top 5. Around 20 listed Companies with sales of around 1.75 lakh cr and profits of 25000 cr. Top companies Like HDFC, LICHsgfin, PNBHsgfin, Canfin etc have around 80% of the market.
Best is HDFC from this Industry.
HDFC: cmp: 2450: A market leader in Housing finance & also the holding company of some of the finest companies which are leaders in their segment. A housing finance company which was doing just turnover of 2300 Crore with a Net Profit of 500 crore 2 decades back is today after 18 years has become India’s 3rd Largest company in terms of market capitalisation & NO#1 Housing Finance company. Today making revenue of around 1 Lakh Crore and a Net profit of 24000 Crore. This year we may see profits cross 35000 cr. Hence investment of 1 Lakh done 18 Years back is today around 75 Lakh and more than invested amount has returned in dividends. This is also a company which we can see enter the elite club of India’s 1 lakh crore + profit making companies till 2035. This year was bad for Housing Finance company due to default of some players, hence a liquidity crunch has felt to companies. Still, 9M revenue has also grown attractively by 26% which is less than expected but better than other companies while Net Profit has grown by 43% again which is too less than expectation of 71%. Acquired 9.9% stake in Bandhan Bank while their HDFC ERGO General Insurance has entered into the agreement Apollo Munich Health Insurance to Buy 51.2% stake. This year was good for all their arms like Banking (HDFCBank), LifeInsurance (HDFCLIFE) and general insurance (HDFCERGO) as well as AMC (HDFCAMC). Buying Should be done during any fall near 1950, Can Accumulate around 5% in Portfolio for long term wealth creation. 73% Holding with FPI & 14% MF as well as Insurance companies holding.
Disclosure: Do Not Buy or sell before consulting your advisor as the writer may have the position in the above-given stocks or indices
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