While the best of banks have a 45% cost to income the NBFC works on a cost to income of 15%. What matters is the RoA and RoE. Most of the frontline NBFCs beat the banks in the RoA and RoE that they generate. If it were not so HDFC would have merged with HDFC Bank long time back.
When the marginal players get killed it gets easier for the leaders to take up market share. ALM mismatch for a company is not a default program itâs a matter of choice. Yesterday one HFC raised US$200 mn through ECB and threw the ALM mismatch whatever it was - out of the window. Basant Maheswari
Disc - No Position.
& the news follows⌠The deal is OFF
the article says
"Carlyle said it has no comments to offer, while PNB said it has not dropped any plan to sell stake in the entity and the process for the same is on. "
its anybodyâs guess ?
This is very good news as far as I am concerned. The company was being extremely well managed under Carlyle PNB group. PNB housing will continue to keep the PNB brand and now there is no scare of it being sold to a competitor. Desparate bidders can still approach the group any time in the future in case they are interested and PNB Carlyle group will only be happy to offload their interest. With PNB continuing to be on board we can be assured that good corporate governance practices will continue in future too. Unlike canfin, PNB Housing has an extremely capable hand leading from the front. I have made several posts earlier on why it is unwise for PNB of sell their stake in PNB Housing. The timing of the stake sale was targeted to perfection but the fates willed otherwise. With an ROE of 19 being targetted next year, a stake sale could have a better response next year as bidders like Bandhan and HDFC give priority to this number.
Interview of Sunil Mehta, MD of Punjab National Bank on PNB housing stake sale (First 6 minutes) with Ruchi Bhatia of ET now published 2 days back. It seems that the stake sale could be delayed, but expected to be completed this fiscal itself.
Perhaps one silly question but I would go ahead and ask anyways: if 1-2 of the potential bidders for PNB HF have genuine interest in acquiring stake @1200 levels, why would they not take advantage of current rout and acquire sizeable chunks from market?
Obviously this will not get them the target size, but 2-4% could easily be built?
Its not silly question. There is no reason to pay more when you have another option to buy cheaper. I have seen recent interviews of Sunil Mehta, PNB MD quoting that stake sale process is still ON. I take it as formal official version as being head of organisation, he canât term the process closed till they have internally discussed and based on received bids / responses, the team accepts the decision by majority.
He is just trying to say his version but from bidders point of view⌠the market cap & current price matters a lot. There is no reason to spend more on higher price when its available at cheaper rates now, although delivery volume in recent weeks donât show any such behaviour.
Overall we have to wait ⌠keeping fingers crossed but most likely stake sale is in bad shape due to September mayhem.
Indian market is unique. Any news of creeping acquisition of shares will spread like wildfire and will lift the prices. Why would any acquirer jack up its own eventual cost of acquisition? Most of sellers suffer from price anchoring bias so allowing it to go up is counter productive.
PNB plans to sell non-core assets worth âš8,600 crore https://www.thehindubusinessline.com/money-and-banking/pnb-plans-to-sell-non-core-assets-worth-8600-crore/article25229502.ece?utm_campaign=amp_article_share&utm_medium=referral&utm_source=whatsapp.com
Possibly a hit and run by some Rating analyst 
Does pnb housing have exposure to super tech loans ?
Supertech MD has informed that there is no default and they are still servicing the loans of Indiabulls housing and all other financiers. Indiabulls housing has also said likewise. It all seems to be the play of operators. They even succeeded in 
investors to sell below IPO price, taking advantage of the fact that PNB housing has put Supertech in their approved list. In the short run the stock market is a voting machine but in the long run it is a weighing machine. Even if in the short run, market goes wrong in valuations, in the long run it gives the right valuation.
PNB housing will be coming out with the results in November 5 and no doubt it will be atleast 1.75 times market growth, as it has been ever since Sanjaya Gupta took over 8 years back. It will be good to listen what this veteran has to say about the crisis. So far in all the concalls, all the questions from all the analysts on any subject of any complexity, were all single handedly answered by the MD himself, even though his team is present, showing his complete and total mastery of the subject. Even where he refused to divulge some figures, he has always mentioned that the figures were readily available with him.
Whatever be the genius in charge of PNB housing, investors with concentrated holdings, keep their fingers crossed.
result on 5th NOV. not on 25th oct.
PNB Housing Finance raises Rs 1,775 crore through commercial papers
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Sir⌠The supertech account is delinquent if not in default⌠A delinquent account is cause for serious concern because it often presages default⌠Markets react and tend to price in future outcomes esp when things have been frothy in the past⌠Perhaps it was the operators too who took this stock to 1700 odd on the way up?.. While I agree that it could be time to make staggered investments in a well managed company like pnb hf, your post additionally highlights the key man risk in the company which one should be cognizant of.
If HDFC was Agni V, PNB HF is Agni VI, a long range ballistic missile. Whatever HDFC has done, PNB HF is replicating and much faster at that. Of course there is key man risk. But this man is very young.
In the previous concall, Sanjaya Gupta informed that he is building an organisation that will last for ever, an organisation people will appreciate and take pride in, long after he is gone. He declared that he could very easily show fantastic results (a la IBHF?) but is being conservative, so as to have something to fall back on (hidden reserves?) being fully prepared to meet any calamity ( Supertech?).
PNB HF shareholders will be rewarded only in the long run. In the 2017 Q4 concall, Sanjaya Gupta declared that he sees decades of growth going forward.
PNB Housing Finance Limited raises INR 1,775 crores through
Commercial Papers
New Delhi, 22nd October 2018: PNB Housing Finance Limited, Indiaâs 5
th
largest
Housing Finance Company, has successfully raised INR 1,775 crores through Commercial
Papers (CP) in October 2018. The CPs are placed to various Mutual Funds and Banks.
Mr. Sanjaya Gupta, Managing Director, PNB Housing Finance Limited said, âIn spite of the
current tight market scenario our Company has successfully raised funds through CPs
aggregating to INR 1,775 crores at competitive rates. We are thankful to various lenders for
placing their funds in our Company. These borrowings in the present environment exhibits
the trust and faith of the lender community in PNB Housing Finance Limited.â
Mr. Kapish Jain, Chief Financial Officer, PNB Housing Finance Limited, further added, âIn
October 2018 we have successfully raised INR 1,775 crores through CPs in addition to ECB.
This has been possible only because of our strong fundamentals moreover we are
comfortable both on our liquidity and ALM position. Further to add, this fund raise shall not
increase our overall exposure to CPs and we would continue to maintain our overall borrowing
through CPs at around 12-13% compared to 19% as of 31st March, 2018. During the month
of September 2018, we did not raise any funds from capital market in view of the surplus
liquidity we had. As on date, the Company has cash and liquid investments of approx. INR
6,000 croresâ.