In This Article:
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Retail Loan Book Growth: 17.5% YoY, reaching INR70,676 crores.
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Affordable Segment Growth: Doubled from INR1,790 crores in March '24 to INR3,838 crores in December '24.
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Emerging Market Segment Growth: 23% YoY, reaching INR13,169 crores.
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Gross NPA: Declined to 1.19% as of December 31, 2024, from 1.24% in September 2024.
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Net Interest Income: Increased by 17% YoY to INR696 crores.
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Cost of Borrowing: Stabilized at 7.83%.
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NIM (Net Interest Margin): Improved to 3.7% in Q3 FY25.
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Profit After Tax (PAT): INR483 crores, a growth of 43% YoY.
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Return on Equity (ROE): 11.81% annualized for nine months FY25.
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Total Loan Book: INR71,917 crores.
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Assets Under Management (AUM): INR76,840 crores.
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Disbursements: Grew by 30% YoY to INR5,380 crores.
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Incremental Yield in Affordable Segment: Increased to 12.14% in Q3 FY25.
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Branch Network: 305 branches across 20 states, with plans to open 50 more in Q4.
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Capital Adequacy: 28.8% as of December 31, 2024.
Release Date: January 21, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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PNB Housing Finance Ltd (BOM:540173) achieved a retail loan book growth of 17.5% year-on-year, surpassing its guidance of 17%.
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The company reported a significant decline in gross NPA, which stood at 1.19% as of December 31, 2024, compared to 1.73% a year earlier.
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Retail disbursements grew by 31% year-on-year to INR5,380 crores during Q3 FY25.
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The Affordable and Emerging Markets segments contributed 38% to total retail disbursements in Q3, up from 29% in the same quarter last year.
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PNB Housing Finance Ltd (BOM:540173) maintained a strong liquidity position with INR6,400 crores in liquidity and additional undrawn lines of INR8,000 crores as of December 31, 2024.
Negative Points
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The company faced challenges in certain markets like Karnataka and MP due to product business headwinds, impacting growth.
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There was an increase in Stage 2 loans by INR450 crores, primarily due to one corporate account.
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Operating expenses grew by 22% to INR203 crores in Q3 FY25, which is higher than the retail loan book growth.
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The cost of borrowing remains relatively high at 7.83%, with incremental cost of borrowing at 7.82%.
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Despite strong growth, the company faces competitive pressure in the Prime segment, which may impact margins.
Q & A Highlights
Q: As you look out for the next two to three years, how do you expect the various levers to impact revenue mix, margin mix, and leverage? What kind of ROE expectation would you have assuming the credit cycle remains stable? A: Our plan by FY27 is to take the retail book to INR1 lakh crores with a mix of Roshni and Affordable at 15%, Emerging at 25%, and 60% Prime. We aim for a funding yield of over 4% and credit costs at 0.25%. We are comfortable with leverage of 5.5 to 6 in the next three to four years, with ROE expected to be in the mid-teens.