Recent decline in HFC stocks caught my eye and I got particularly interested in DHFL owing to ~50% slump in share price.
It’s trading at 1.06 times its Book value now!
This is undervalued and attractive, but the question is that is it the best investment choice to make?
I tried to compare DHFL figures with some of its peers and found nothing extraordinary about the company.
DHFL has a very good AUM growth rate of 33% but an ok NIM at 3.04%. But, in addition to having Gross NPA (0.93%) and D/E Ratio (10.53) on a higher side, DHFL figures show mediocre returns in terms of ROE/ROCE/ROA with respect to its peers.
Having said that, I personally think that Mr. Market has been too harsh on DHFL as there is nothing unusual going on with the firm (or we haven’t heard it yet?)
I am looking to invest in DHFL but would like to know experts’ opinion. Do you see a multi-bagger potential in DHFL in coming years? What did I miss in my analysis?
My bigger question although is: (As I have limited knowledge of the sector)
Is it the right time to invest in any NBFC/HFC at all?
Really appreciate your opinion in advance!