PNB Housing Finance’s (PNBHF) Q4FY22 earnings delivery was weak and lower than expected as PAT plunged a further 10% QoQ to Rs1.7bn (up 33% YoY on a low base). NII contracted 37% YoY / 14% QoQ as NIMs fell 96bps YoY / 34bps QoQ due to spread contraction, Ind-AS adjustments and derecognition of securitisation income. Slippage of one chunky developer account of Rs6.6bn was offset by corresponding improvement in retail GNPAs, and stage-3 was stable QoQ. On retail stress (stages-2/3) pool of 7.8%, PNBHF carries ECL provision of 2%. On corporate stress pool of 37.4%, it has ECL provision of 22%. Cumulative, on overall loans, ECL provisions improved a tad to 4.42% (vs 4.31%) and credit cost was contained at 100bps. Disbursements in retail are building momentum and retail book expanded QoQ after 9 quarters (with the exception of Q1FY22). However, down-selling and deleveraging of the corporate book dragged AUM down 11% YoY / 1% QoQ. Business priorities are to target mass retail housing, build the high-yield Unnati portfolio and drive efficiency through cost management. Nonetheless, actual progress is lagging expectations and needs some realignment at granular level. Maintain HOLD with a revised target price of Rs395 (valuing it 0.65x FY24E ABV; earlier Rs485).
Shares of PNB Housing Finance Limited was last trading in BSE at Rs. 372.20 as compared to the previous close of Rs. 377.90. The total number of shares traded during the day was 13790 in over 671 trades.
The stock hit an intraday high of Rs. 377.90 and intraday low of 368.30. The net turnover during the day was Rs. 5110930.00.