REPCO home finance

Repco Home Finance Ltd has informed BSE that the Company proposes to raise upto US $ 40 million by an issue of Non Convertible Debentures (NCDs) to International Finance Corporation.

http://corporates.bseindia.com/xml-data/corpfiling/AttachLive/CBBEAD2E_858D_4749_8FCE_AC37EEAB0919_131749.pdf

Repco Home Finance Ltd has informed BSE that a meeting of the Board of Directors of the Company will be held on May 10, 2016, inter-alia, to consider the following:

  1. Approval of Audited financial results of the Company for the year ended March 31, 2016.
  2. Recommend dividend for the financial year 2015-16

Any estimates on Q4 results?

http://corporates.bseindia.com/xml-data/corpfiling/AttachLive/4EEBC61E_5932_4D3D_BDAF_EC5258A04E39_161712.pdf
Q4 results came out…just after market closed @ 16hrs

Repco Home Finance Ltd has informed BSE that the Board of Directors of the Company at its meeting held on May 10, 2016, inter alia, has recommended a dividend of Rs. 1.80 per share of face value of Rs. 10 each for the financial year 2015-16.

http://www.bsealerts.in/ann.php?99661

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Result: Q4 fy16

  • Q4 16 performance:
    o Net profit: 42.22 crores as against Rs 34.81 crores during same period last year 21% growth
    o Income from operations in the quarter ended march 2016 is 240crores as against 191.31 crores 25% growth
    o Loan sanctioned is 12%
    o Loan disbursement is 20% over the same period
  • FY 16 performance
    o Net profit 150 cr vs 123.08 crore 22% growth
    o Income from operations 27% growth
    o Sanction loans 31%
    o Loan Disbursement 31%
    o Loan book growth was 28 % ( 7691.19 cr VS 6012.92)
    o Gross NPA stood at 1.31% and net NPA at 0.48%
    o Loan breakouts:
     Self employed segment accounted 58.76%
    o Capital adequacy stood at 24% against minimum requirement of 12%
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There is no point bashing a third person on this platform. BTW what is wrong with the results vs. your expectations?

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As said before, no use bashing someone unnecessarily. He is where he is bcos of his track record.

Results prima facie seem decent. Management has walked the talk about NPAs getting under control in q4. (as indicated in q3 concall)

The beauty of such companies lies in its consistency and predictability. Plus bcos of higher proportion of loans to self employed customers, it will face lesser competition from other organised players and even banks.

25 Likes

Very well encapsulated Hiteshbhai … Any view on the q4 new sanction growth of 12 odd pc. It looks low but could just be seasonal variation. I have not seen what growth occurred same quarter last year.

Exactly my point, we have a habit of looking at net profit and EPS nos. while it is amply clear that they have to make some accelerated provisions suppressing PAT in the near term. There is saying in the local language for those who try to act clever by growing too fast in lending business. Link

Sorry if anyone finds the link offensive :slight_smile:

Cost of debt is 9.4 % as 72 % funding is from Banks. This will come down in years to come as they get better ratings.

Can fin homes has cost of debt of 8.75 % as more debt is funded from NCDs.

NPAs are under control. And most important the balance sheet has expanded 27% with CAR north of 20% which means no dilution in FY17.

Repco is on a solid track.

6 Likes

FY16 loan book growth is 28% which is inline with management guidance of 25 to 30%.

NPAs are back to 2015 range and overall decent FY16 performance.

Disc: Invested.

I think the results sld also be evaluated in the backdrop of a slowing economy and rural distress. Loan book growth of 28% in a tough environment is good.

Below is a quote from this thread dt. May '13, post #32

With the increase in govt spending, the economy appears to be settling. This sld be followed by capex revival by private companies (when, maybe 2-3years, atleast when cappacity utiliasation is close to 90-95%). All this sld lead to a higher growth phase for Repco and other HFC’s as well.

Rgds
Bobby

discl: Invested

1 Like

http://www.motilaloswal.com/site/rreports/635985548525385277.pdf[quote=“satsat, post:1, topic:240, full:true”]
Unable to post tables as i am posting from my mobile therefore.

But these links would give you a fair idea about the company

REPCO has second highest margins in the industry after gruh and is being offered at a discount to gruh

https://www.sptulsian.com/article/73655
[/quote]

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Hello Sameer,

There is a thin but clearly demarcated line between being critical and being a troll.
The way i see it, a critic would give detailed analysis of his contrarian point of view while a troll makes his point through sarcastic one-liners, or off-handed remarks without any substantiation.

Case in point:

This remark is in my opinion more trollish in nature than being a reasonable and sound criticism.
The immediate replies to your post advised to refrain from bashing, indicating that above assessment is more true than false.

Urge u to take this feedback in a positive light.

On the other hand, as @Irshad highlighted, your approach is indeed an interesting mental model of going about getting information.
However, it is a dangerous approach which if not properly applied can create a lot of bad relations.
All i am saying is feel free to criticize, but back it up with sound and reasonable arguments to have a well-balanced discussion.
Eventually constant criticism of a trollish nature will make forum members ignore your queries in totality, howsoever valid they may be.

True, somebody has to play the devil’s advocate.
But with great power comes great responsibility. :smile:

Regards.

16 Likes

CONFERENCE CALL - from Capital Markets

Expects to sustain 25%+ loan growth in the medium term

Repco Homes Finance conducted conference call on 13 May 2016 to discuss the financial performance for quarter ended March 2016. R. Varadarajan - Managing Director addressed the call:

Highlights:

  • Loan book of the bank increased 28% to Rs 7691.2 crore at end March 2016, driven by 31% growth in disbursements to Rs 2851.2 crore and sanctions rising 29% to Rs 3082.8 crore in FY2016 over FY2015. The company continues to hope to maintain loans growth above 25% in the medium term.
  • The disbursments moved up 20% to Rs 897.5 crore sanction incerased 12% to Rs 934.2 crore in Q4FY2016 over Q4FY2015.
  • Loan book mix between home loans and LAP was 80.2:19.8 at end March 2016 compared with 80.8:19.2 at end March 2015.
  • The customer mix between salaried and non-salaried was 41.2:58.8 at end March 2016 compared with 43.2:56.8 at end March 2015.
  • GNPA ratio was steady at 1.31% at end March 2016, compared with 1.32% at end March 2015. NNPA ratio was also flat at 0.48% at end March 2016 compared with 0.5% at end March 2015.
  • GNPA ratio for the salaried segment stood at 0.7% and non-salaried at 1.8%. Meanwhile, the GNPA for Home Loan was at 1.1% and home equity at 2% at end March 2016.
  • State wise, GNPA ratio stands at 1.1% for Tamil Nadu, 1.2% for Karnataka and 0.6% for Maharashtra at end March 2016.
  • Provision coverage ratio (PCR) of the company improved to 63.5% at end March 2016 from 62.4% at end March 2015 and 51.5% at end March 2014. The company expects PCR ratio to improve to 70% by end March 2017.
  • The company has decided to make provisions for sub-standard loans at the rate of 40%, above the regulatory requirement of 15%. The company has Rs 61 crore sub-standard loan where the company has raised provision to 40%, while the doubtful loans stands at Rs 39 crore where the provisions stands at 100%.
  • Spread stood at 3% and NIM at 4.4% in FY2016, compared with 2.9% and 4.5% in FY2015. Company expects to sustain target of 3% spread and NIM above 4% in the medium term. As per the company, the NHB has raised the spread limit on its financing to 3.5%, which is expected to support the spreads of the company.
  • The company has improved cost-to-income ratio to 19.3% in FY2016 from 21% in FY2015. The company expects to maintain cost-to-income ratio below 20% in FY2017.
  • The branch network of the company increased to 150 branches at end March 2016 from 142 branches at end March 2015. The company proposes to add 10-15 branches in FY2017. The branches opened in Southern India achieves break even in 8-12 months, while branches from rest of India achieves break even in 18-24 months.

Disc: Invested in Can Fin Homes.

9 Likes

The disbursments moved up 20% to Rs 897.5 crore sanction incerased 12% to Rs 934.2 crore in Q4FY2016 over Q4FY2015. strong text Doesnt this flag something. Lower sanctions but higher disbursements!!! does this mean Co is restructuring/evergreening loans.

Disc: invested

can someone explain the difference between sanctions and disbursements?

I would try to explain in layman’s terms.

Sanctions - It’s amount of loans sanctioned in noted period. It’s not necessary that this money is released to house buyer/builder. For example an under construction house can have 50L loan sanctioned. But only part of the loan will be released every year.

Disbursements - This is actual money that’s released in noted period. This money is part of loan book.

Both sanctions and disbursement show pace of growth. But they vary from loan book figures due to factors like repayment, partial disbursement etc.

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Thanks Nikhil,
I am trying to understand the reason behind disbursements being higher than sanctions for lenders. I would assume that it is possible that sometimes lenders disburse a little less than what they have sanctioned. But, why is it that disbursements are higher than sanctions for all HFCs?

Just trying to logically think to answer your question - I maybe wrong as well.

As Nikhil pointed out above - loans sanctioned can be for big amounts (Eg 1 cr) but disbursements may only happen in parts (20 lakh tranches) based on customer requirements, phase of project completion, etc.

So if there is any time period where fresh sanctions are low and there were a lot of pending disbursements which got released, then the disbursements would be higher than sanctions for that time period.

This could be pointing towards a trend where HFCs are becoming more selective about fresh sanctions based on customer profile, land ownership, builder profile, etc.

I would be worried if disbursements are greater than sanctions on a consistent basis (9-18M comparisons YoY)

Thanks for the replies guys! I was focusing on % growth in disbursements vs sanctions, which was the wrong way to look at it. I should have looked at total amount of disbursements vs sanctions. The total amount of disbursement is about 7% to 8% lower than that of the sanctions for all HFCs. So, no major worries there.

1 Like