Graphic: Naveen Kumar Saini / Mint
PNB Housing Finance Ltd managed to dispel some concerns about its liquidity position, reporting strong quarterly earnings in September. By supporting an increase of 43% in managed assets, the household lender reported a 33% increase in net profit and an increase of 25.4% in revenue.
This means that its cost dropped to 14% from 25% in the previous quarter, indicating that the lender does not have a solid foundation in terms of liquidity.
In fact, analysts believe that its breakdown may slow down due to pressure on liquidity.
The PNB for Housing Finance ALM (asset liability management) is ₹ 530 crore for one to three month maturity and the total difference ₹ 900 crore in less than one year terms. In other words, in order to delay the growth of loans, the company will have to achieve ₹ 900 crore liquidity.
Analysts from Jefferies India Pvt. Ltd noted that the share of commercial securities in total PNB housing finance loans fell to 13% from 17%.
This, coupled with the fact that the lender was able to attract more than ₹ 6 000 crore in the last month with CP, should provide investors with comfort.
However, borrowing costs have increased and it could cut profits and profits. Management has managed spreads to be 205-215 basis points.
This leads us to a bad loan position. The PNB Housing Financing has had a bad credit interest rate and continues to do so. Its total bad loans as a percentage of the loan book was only 0.45%.
It could be at risk because it would expose ₹ 280 crushes to Supertech Ltd, a cumbersome developer. Exposure is classified as standard.
The non-residential loan portfolio has grown by 54%, driven by loans to property and construction finance. Although the loan book is diverse, the lender has seen a more rapid increase in the book's most risky part.
In the stock, "PNB Housing Finance" was exerted pressure in September on other NBFC (non-bank financial company) shares when liquidity issues were related to NBFC.
Since September, the PNB Housing Fund's 30% decline has made the assessment modest, and it deals with 1.7 times the amount compared to the estimated book value of 20. FG.