Repco Home Finance Q1 Review - Stress Skewed Towards Restructuring; Growth Lacks Momentum: ICICI Securities
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ICICI Securities Report
Repco Home Finance Ltd. earnings were dragged by higher credit cost of 260 basis points (less than 70 bps for full year FY21).
This was on anticipated lines as dominance towards the self-employed customer segment was expected to reflect elevated stress amid Covid-19 disruption.
However, the texture of stress was skewed more towards restructuring that restricted spike in stage-III assets to 4.4%.
Repco Home Finance's provisioning towards restructured pool and delinquency buckets of Rs 783 million dragged profit after tax to Rs 321 million (down 50% YoY as well as QoQ).
Growth momentum lags peers, but superior net interest margin sustained operating profit trajectory.
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