LIC Housing Finance Q1 Review - Erratic Asset Quality Behaviour Is Baffling: Prabhudas Lilladher
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Prabhudas Lilladher Report
LIC Housing Finance Ltd.’s developer book stage-III at 24% plus which has remained higher in double digits since nine quarters in a row, stage-II exposure at 20% and overall stress at 54% (including restructured: Rs 47 billion) is baffling.
Moreover, despite 91% salaried customer focus, retail home loan stage-III at 2.6% is equally disappointing.
LIC Housing Finance's Q1 FY22 earnings were further marred by higher sequential interest costs (up 5% QoQ albeit decline in cost of fund), one-off employee costs (Rs 1.2 billion) and elevated provisioning (143 basis points credit costs).
While second wave restricted loan book expansion (0.2% QoQ), we reckon trajectory should only remain tepid for FY22 in light of surmounting asset quality challenges.
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