Key player of housing for all..
Dewan Housing Finance Corporation (DHFL) is the 3rd largest private sector housing finance company (HFC) in terms of AUM in India. It primarily provides housing finance to individuals, especially to the low and lower-middle-income groups in Tier II, III and IV cities. The company also offers non-housing loans such as loan against properties (LAP), SME and developer loans.
View & Valuation:
DHFL is a play on the high growth Indian housing finance industry, which is driven by rising income levels, growing urbanization and low penetration of housing finance and shortage of affordable housing. We like DHFL due to its consistent loan growth, stable NIM, strong asset quality, better capital adequacy, improving return ratios and reasonable valuations. At CMP of Rs297, the stock is trading at P/ABV of 1.7x and 1.5x for FY17E and FY18E, respectively, a steep discount to other HFCs (trading >2.5x FY18E P/ABV). We assign BUY rating on the stock with target price of Rs385 based on 2.0x FY18E P/ABV.
Investments in equity shares, debentures, etc., are not obligations of, or guaranteed by Wealth India Financial Services Pvt. Ltd., and are subject to investment risks. Click here to read our full disclaimer.
Get FundsIndia’s articles delivered straight to your inbox!
Enter your email address to get:
- Mutual fund recommendations from experts
- Buy, hold or sell calls for stocks
- Investment tips and tricks
- All the latest news from Fundsindia.com