I believe the name does not need any introduction and time has ripe to re-look at this gem. Second most profitable housing finance company doing all the right things to hog the limelight.Awesome dividend payout ratio at morethan 50%. Reverse merger is near to completion leading to convert itself in to a pure housing finance company and a strong re-rating is on cards.
Loan book is standing at 32,500 cr up 30% from last year.Management projecting 25-30% CAGR earning for the next few years, no wonder they would achieve that as the interest rates have peaked out. Company is not going with the herd in chasing for banking licence and is concentrating to grow in the segment that they are present currently. Credit rating stands at AA+ leaving room for further margin expansion as the credit ratings upgrade is imminent given the fact that they have been growing well even at high base.Promoters have increased their stake recently.Off-late market perception towards the group has been changing with their recent earnings, leading to higher PEre rating.
All the group companies have beenperformingbetter off-late.
(Thanks to Ayush and his team … reduced my effort here )
Higher and wonderful dividend yield than all gruh,lic,can fin etc. though growing equally at 25-30% CAGR.
Consistency in profit growth.
Low return on equity. ( although on the verge of increasing )
Higher cost of borrowing. ( bound to come down with the impending rate cut and ratings upgrade)
Veritas questioning Indiabulls Corporate Governance. ( though nothing much concerning things were highlighted )
Stock has given multi year breakout around 260 levels and is looking very strong.
They should be able to grow at 25-30% CAGR for the next 3 years at least and there is enough room for margin expansion and for PE re-rating as well. All this with the healthy dividend too :).Seems to be one of the best bets worth considering for core-portfolio with a 3 year view.