PNB Housing Fin - Fast Growing HFC

(butun) #246

Comparison of LAP rates. Does not look like PNB has any headline rate advantage to attract good quality borrowers as such.

Bank/Provider Name Interest Rates Loan Processing Fees
HDFC BANK 10.5% onwards 0.5% of loan amt. or Max. Rs. 10,000
ICICI BANK 9.7% onwards 0.5% of loan amt.
AXIS BANK 9.75% onwards 0.25% + ST
INDIABULLS 10% onwards 1%
DHFL 10.25% onwards 1%
LIC HFL Upto 1 Cr - 10.50%; 1cr to 3 cr 10.80%; 3 cr to 5 Cr 11% Govt Emp- Rs 1000 + ST, Others Rs2500+ST
PNB HFL 10.25% onwards Rs 10000 for salaried / 0.50% for self employed
TATA CAPITAL 11.25% onwards 1%
CITIBANK Salaried :10.00% and Self Employed :Upto 1 Cr 10%, 1 Cr to 3 Cr 9.75%, Above 3 Cr 9.5% 0.25%

(Amitayu) #247

Basically, for any finance companies, Asset quality is much depended on Management pedigree /execution skills. It was assumed that affordable Housing loan is safer than traditional Big Ticket Housing Loan/LAP, but latest result of few NBFCs like MOSL Housing Finance subsidiary (Aspire)busted the Myth. We saw it’s low ticket housing subsidy clocked 6.5% GNPA which is much worse than LAP loan. Actually, all depend on the parameters which company are checking before providing a loan, If any loan provided without analyzing cash flow then it bound to be default irrespective of the type of Loans.

(Jaclyn) #248

That is published value at the higher end. But the actual number is 48%. Refer to the recent qtr presentation.

(butun) #249

Ok. Thanks. I was more referring to policy of the bank which will protect the future risk but good that they are not using top end of the LTV.

(Jaclyn) #250

For Aspire, the MO management has acknowledged that they did not run a tight ship and still learning the ropes particularly in handling collection.

(Kumar Saurabh) #251

@amitayu My comment was in general to canfin and pnbhfl where before comparing book value numbers etc, it is more important to see distribution of lending.
@sgjaclyn Depending on mgmt words is proportional to amount of trust one has in management based on his own experience of tracking Personally, I have never tracked this company as a stock,so, no comments here
@pranav_pratap I have been a customer of this company from past 3 years. During 2013-15 when real estate was going through bad times, lot of developers tied up with real estate financing companies and launched double your money kind of schemes. The arrangement was it is buyer who gets 100% loan amount in advance, takes all the credit risk, passes it to builder. Builder assures that equity money given by buyer will double in 3-4 years and after 3-4 years it is up to buyer whether he wants to retain the flat or take double money (no one suffers, only buyer suffers if things go wrong. Developers get lot of money at the credit risk of buyer else he would have got same loan at 18-20%, financier gets great way to show stupendous growth). Flow 3 years down the line, some of the projects are not closed to delivery,so, buyers fighting with builder and financier. Those who want to retain home may want to shift from NBFC to SBI (buyer had to get loan from a specific NBFC as a part of arrangement). Those who want to get double money are fighting with developers in many cases as it was pipe dream. I am not sure how much exposure of overall lending portfolio each of such NBFCs participating in these schemes have/had and hence can not comment on overall lending quality. However, PNBHFL was involved in some of projects in Bangalore Mantri webcity phase 2 and 3 under similar scheme

(Kumar Saurabh) #252

@pranav_pratap @amitayu Personally, as a customer, my experience with PNBHFL in terms of service has been good (based on 2-3 interactions), however, i know people who are stuck in such schemes where with Indian mindset of buying real estate and lure to double income, people invested in multiple project and now when real estate prices did not double, developer did not meet commitments, tussle between builder, developer and customer is going on. I am not sure about scale of problem, hence, can not comment if this will have very small or large impact on the parties involved in future but this could be worth digging for someone with strong exposure.

(Amitayu) #253

It depends on customer whether he is salaried /Self Employed , Branch network etc. Yield for Self Employed Customer is more and moreover, it has reach on Tier2-Tier 3 Cities where competition is less.


Thanks for the detailed description. This looks like a typical case of greed getting better of the investors; this time in real estate.

(aashu24ahuja) #255

It seems market is pushing down PNBHousing, maybe investors are concerned with PNB bank scam and they think it is going to impact PNBHousing also.

I believe it has nothing to do with PNBHousing Finance, inviting your views for the same.

(Growth_without Debt) #256

‘Bap Jaisa Beta’ Is DNA effect going to play in people’s mind?
In competitive HFC market, if a company (newly listed) grows AUM too fast compare to old proven guys (Gruh), people see with caution!
In Finance, everything finally ends with how best underwriting HFC/Banks is doing for loan. Is company focusing super fast AUM growth relaxing on underwriting norms or they are OK with reasonable AUM growth without compromising underwriting policy. First could rise fast and fall fast but later one can steadily grow upward in market.

(Rajarshi) #257

I have observed that you have been trying to spread rumors and speculation without any substance to back it up. Previously also you had speculated that Basant Maheshwari had sold of all his investments in PNB housing without being able to back it up. Now you have come again to start spreading rumours and escape once confronted and asked to back with facts. ‘Bap jaisa Beta’ is an absolute invalid statement in this case as PNB management is in no way associated with working of PNB housing.

(Growth_without Debt) #258

Check here who are first two people

(Amitayu) #259

LOL, Since when Non-executive Directors are part of Operation of a company or have Decision-making power on a company operation? In Investment, it is much necessary to know about the financial related terms. Basic understanding of those terms helps a lot.

(amolk) #260

Few points and your thoughts please.
RBI ask PNB to pay entire 11,300 cr. From where this money will come from?
PNB approximately has 33% shareholding in PNB housing. i.e. valued at 6900 cr.
Will PNB be forced to sell its holding in PNB housing? If yes, as few members said, this should be good in the long term.
However, what happens to the PNB brand? I read somewhere that PNB housing can only use “PNB” brand as long as PNB holding is maintain above 30%.
What happens if the holding falls below 30%?
Also, with PNB fraud headline all around - What happens to the trust of the depositor?
Just think about this. If someone had fixed deposit in PNB, then won’t these people be moving their FD’s to other banks? What happens then?
Common people won’t be able to distinguish between PNB and PNB housing. Post this damage of PNB brand - Would this impact PNB housing finance buiseness? Would people prefer other bank loans instead? What will happen to PNB housing deposits? Will people liquidate that too in panic.

Your thoughts please.

(spvk1) #261

(spvk1) #262

PNB hands over to CBI list of 150 fraudulent LoUs issued to Nirav Modi

(spvk1) #263

Nirav Modi: ED seizes diamond, gold jewellery worth Rs 5,100 crore in searches

(thecroc) #264

Just a reminder for people equating Housing finance with everything else and also speculating arbitrarily:

If there was a huge NPA problem to happen in Housing finance it should have led to trouble first in housing loans of PSU/Private Banks and HDFC by now, as they have done far more business in housing than PNB Housing and they seem to have survived with Unitech and all that in the housing area. Because there are no 45000 crore loans to be given in housing.

As long as numbers speak what they do , PNB Housing remains a good long term bet for me, specially with the new RBI rules : . Doodh ka doodh and Paani ka paani will happen for all of the loan business in the next 2 years anyway.

(Rajarshi) #265