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IDBI Capital Report
Repco Home Finance Ltd. reported further decline in its loan growth to 6% YoY (Q1 FY21) versus 7% YoY (FY20); however reported strong growth of 3% QoQ led by higher interest accrual (Rs 2.3 billion) although disbursements declined by 73% YoY.
Asset quality improved on a sequential basis with gross non-performing asset at 4% versus 4.2%.
Net interest income remain flat YoY led by decline in net interest margins; pre-provision operating profit grew by 4% YoY led by improvement in cost to income ratio.
Profit after tax grew by 3% YoY led by lower tax rate; profit before tax declined by 10% YoY led by higher provisions.
Management guidance for 5% growth in the asset under management has made us revise the estimates on loan growth at 5% for FY21 versus 2% YoY earlier.
However, despite the uncertainties in the sector it is able to garner a spread of 3% with a comfortable liquidity position.
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