Dewan Housing Finance Limited


(Mahesh C) #121

I think CanFin loan ticket size could be a bit skewed by the fact that about 30% exposure is in Bangalore and avg home price of 1BHK apartment itself is about Rs 40lac. I think for now they are mostly Metro and Tier 2 cities based. When they expand the foot print to much smaller towns, you will see the avg ticket size going down, you can also imagine the prospects of growth in that market with govts proposal to subvent the interest cost.
I could be biased because I own CanFin Homes shares.


(kums17) #122

Fitch Ratings plans to withdraw the ratings on Dewan Housing Finance Corporation Ltd on or about, February 22, 2017. Any known reasons for this decision?

Invested

Read more at:
http://economictimes.indiatimes.com/articleshow/56683894.cms?utm_source=contentofinterest&utm_medium=text&utm_campaign=cppst


(RICHAJ) #123

Considering rating companies’ business model, and Fitch’s quote from the ET article about “…withdrawing due to commercial reasons…”, I wouldn’t be too concerned about it. How much of DHFL’s debt is in foreign currency and how much is domestic?


(Amit) #124

http://ftp.motilaloswal.com/emailer/Research/DHFL-20170214-MOSL-CU-PG006.pdf


(rajput.delhi) #125

After this, how long can DHFL remain undervalued :slight_smile:

  1. DHFL to get 1600-2000cr for selling 50% stake in insurance company
  2. Deal to close by Mar-end (post regulatory approvals from RBI, IRDA, CCI) which means this amt will be deployed as loans in q1-18 and considering 18% ROE will add about 200cr to 2018 PAT.
  3. BV to go up by about 25% with no equity dilution
  4. At 322, 2018 P/BV is 1.15 and PE is 7.5.
    Stake being bought by wholly owned subs (a promoter holding co) which is raising debt to fund this deal.
    Before this deal, DHFL was trading at around 1.3-1.5 P/BV 2018 and within a day it becomes more valuable at 1.15.
    This world of finance is simply amazing :slight_smile:
    People might raise eyebrows now for some days maybe years but if business continues as usual for next 2-3 qtrs which is likely given huge tailwinds in the affordable housing sector, this deal structuring could well be forgotten in a year’s time and then in May-2018, it might appear that this was such a no brainer in Feb-17 :slight_smile:
    Rgds
    RR
    Disc: Invested

(Chandra) #126

Thanks Rajput. You have summaraized the info nicely. Though stock is trading near life time High, it looks value buy.
Disclosure: Invested 3 % of my overall PF.


(csteja) #127

DHFL investors, @rks00

Any idea when all the warrants hold by promoters will be converted to equity shares ? I am unable to find that document with date.

Also, 25% of warrant amount i.e 125 cr is paid by promoters in march 2016. The rest (75%) should be paid before next 18 months. I would like to know whether promoters had paid any parts of 75% till now ? If not, did the company sustained on 125 cr for CAR in last 18 months ? Just curious to know the importance of money raised by 75% and how it is put to good use by company

@rajput_delhi,
You mean to say we are going to see BV reflecting in BS from march 2017 ? Also company need not raise CAR for at least next 18 month ?


(rajput.delhi) #128

Yes sir, BV will go up as the sale of Life Insu stake for 2k cr was concluded on 31st Mar.
Also all warrants money was paid by promoters long back.
And DHFL current rate of disbursement is about 7k cr a qtr.
Thx
RR


(phreak) #129

I have been holding DHFL since about 280 levels. Going by FY18 estimates, this still looks quite undervalued compared to other HFCs going by just P/E and P/BV. At 430, is it still worth adding some more of this? I am wondering if I should double my holding at this price. My holding is fairly long term.


(goutam) #130

I too have been holding since 214 (average price) . I think it is worth adding some more given the undervaluation , low NPA levels and profit growth in the last couple of quarters. I am planning to take my average price to 250.


(goutam) #131

Motilal Oswal report . TP 500 .


(Jehan Bhadha) #132

DHFL to sell its 50% stake in Life Insurance JV to wholly owned subsidiary DIL
Promoter group co will give funds of 1900cr to DIL in exchange of CCPS for 100 months.
So effectively 1900cr is being transferred from Promoter co to DIL & at the end of 100 months, new equity shares of DIL will be issued to promoter co.
Hence in the end promoter co may become a subsidiary of DHFL in the end again owning the insurance business.

As per this article - http://www.livemint.com/Companies/f8CcBz5La8Jf7pSMyCXetL/Why-DHFLs-decision-to-sell-its-life-insurance-business-is-b.html


(Rejinoldo) #133

Is this the 1900 crore entry as exceptional item in the Q4 RESULT ?


(goutam) #134

Yes. This is due to a stake sell in insurance business.


(goutam) #135

Edelweiss gave a buy on DHFL . Target 580


(Sujay Ghosh) #136

Excuse my ignorance. I am a newbie and continuing to learn.

Does the consolidated financial performance of DHFL includes that of its Life Insurance, AMC, Educational Load etc. arms?

“Our strategy has always been to invest in ventures that bear fruit in the long run. DHFL has been consistently investing in avenues which have similar potential to create value. With access to more efficient source of funds, invaluable customer trust, better financial performance and best-in-class management standards, we are building DHFL into a preferred financial services brand. We continue to look for synergies with complementary businesses like micro-finance, asset reconstruction, fintech platforms and similar enablers that will help us expand our retail reach and provide integrated financial solutions to customer segments for a variety of needs under one roof.”

From Annual Report 2016-17

Disc: Invested


(goutam) #137

Yes . Consolidated means includes everything…


(Saurabh Maheshwari) #138

Yes & No. Consolidated financial performance includes results of all majority owned subsidiaries (Ownership >50%). DHFL has a minority stake in most of the businesses. Additionally, life insurance business has been sold by DHFL to the promoter entity through a complex transaction.

Attached a Group structure as on 31st March


(kumarshah) #139

Results:

Dewan Housing Finance Corporation Ltd reported its standalone Q1FY18 Results. The net interest income (NII) for Q1FY18 increased by 29.3% to Rs 619.7 crore yoy against Rs. 479.1 crore in Q1FY17. This was due to 23% yoy increase in loan sanctioned amounting to Rs. 10,862.8 crore .

Any idea why there is a steep fall today, results seem good overall.


(bbbhutra) #140