Capitaline

Results 19-Oct-23

Analysis

Can Fin Homes

AUM rises 16%, margins improves

Can Fin Homes has posted 12% rise in the net profit to Rs 158.07 crore in the quarter ended September 2023 (Q2FY2024), driven by 26% increase in net interest income. However, the company has witnessed increase in cost to income ratio and jump in provisions for fraud and higher slippages of restructured loans in Q2FY2024.

The company had reported the fraud incident at Ambala branch and it has created entire provision of Rs 39.67 crore for fraud incident in Q2FY2024 impacting the bottom line of the company for the quarter.

The net interest income of the company increased 26% yoy. The net interest margin improved to 3.80% in Q2FY2024 from 3.48% in the previous quarter and 3.55% in the corresponding quarter of last year. The loan growth was healthy at 16% end September 2023. The company witnessed some deterioration in asset quality, which still remains one of the best.

The disbursements of loans eased 10% yoy and loan sanctions also declined 10% in Q2FY2024 over Q2FY2023.

Can Fin Homes has posted 12% growth in the net profit to Rs 158.07 crore for the quarter ended September 2023 (Q2FY2024). Interest income increased 32% to Rs 871.02 crore, while interest expenses rose at higher pace of 37% to Rs 548.45 crore. NII of the company galloped 26% to Rs 322.57 crore in Q2FY2024.

Operating expenses increased 34% to Rs 49.66 crore, allowing the operating profit to rise 24% to Rs 272.93 crore. Depreciation declined 19% to Rs 2.76 crore, while provisions surged 446% to Rs 72.19 crore in Q2FY2024. PBT declined 2% to Rs 197.99 crore.

Effective tax rate fell to 20.2% in Q2FY2024 from 30.1% in Q2FY2023. The final bottomline of the company increased 12% growth in the net profit to Rs 158.07 in Q2FY2024.

Book value of the company stood at Rs 297.5 per share at end September 2023, while adjusted book value net of net NPA and 10% of restructured loans stood at Rs 285.8 per share at end September 2023.

Business highlights

The loan book of the company increased 16% yoy and 3% qoq to Rs 33359 crore end September 2023. About 72.4% of the outstanding loan book is from Salaried Professionals. Further 89% of loam book is home loans.

The disbursement of the company declined 10% yoy to Rs 2019 crore, while sanctions eased 10% to Rs 2123 crore in Q2FY2024.

The net interest margin of the company improved on sequential basis to 3.80% in Q2FY2024 from 3.48% in Q1FY2024, while it also gained from 3.5% in Q2FY2023.

The yield on advances jumped to 10.07% from 9.84% in Q1FY2024. The cost of funds was steady on sequential basis at 7.32% in Q2FY2024.

Gross NPA ratio of the company rose to 0.76% and net NPA ratio increased to 0.43% end September 2023 compared with 0.63% and 0.34% end June 2023, while also moved up from 0.62% and 0.35% end September 2022.

Financial Performance H1FY2024:

Can Fin Homes has recorded 12% growth in the net profit to Rs 341.53 crore for the half year ended September 2023 (H1FY2024). The interest income increased 34% to Rs 1694.99 crore, while interest expenses rose at higher pace of 43% to Rs 1081.45 crore. NII of the company galloped 20% to Rs 613.54 crore in H1FY2024.

Operating expenses increased 20% to Rs 90.44 crore, allowing the operating profit to rise 20% to Rs 523.24 crore. Depreciation fell 2% to Rs 5.46 crore, while provisions zoomed 800% to Rs 85.89 crore in H1FY2024.

PBT rose 2% to Rs 431.89 crore. Effective tax rate declined to 20.9% in H1FY2024 from 27.9% in H1FY2023. The final bottomline of the company increased 12% growth in the net profit to Rs 341.53 in H1FY2024.

Can Fin Homes: Results
	2309 (3)	2209 (3)	Var %	2309 (6)	2209 (6)	Var %	2303 (12)	2203 (12)	Var %
Interest Inc.	871.02	657.48	32	1694.99	1268.69	34	2742.00	1987.83	38
Interest Exp.	548.45	400.99	37	1081.45	757.10	43	1700.86	1153.51	47
Net Interest Inc.	322.57	256.49	26	613.54	511.59	20	1041.14	834.32	25
Other inc.	0.01	0.07	-86	0.14	0.45	-69	1.13	0.68	66
Total inc.	322.58	256.56	26	613.68	512.04	20	1042.27	835.00	25
Op. Exp.	49.66	37.07	34	90.44	75.40	20	164.02	143.20	15
OP	272.93	219.49	24	523.24	436.63	20	878.25	691.80	27
Woff/Prov. of B/D	72.19	13.23	446	85.89	9.54	800	41.76	46.94	-11
Dep.	2.76	3.40	-19	5.46	5.57	-2	12.46	9.81	27
PBT	197.99	202.85	-2	431.89	421.54	2	824.03	635.06	30
Total Tax	39.91	61.14	-35	90.36	117.61	-23	202.82	163.95	24
PAT	158.07	141.71	12	341.53	303.92	12	621.21	471.11	32
EPS*(Rs)	47.5	42.6		51.3	45.7		46.7	35.4
Adj BV(Rs)	285.8	240.7		285.8	240.7		263.9	219.2
* On current equity of Rs 26.63 crore. Face Value: Rs 2
Figures in Rs crore,
Source: Capitaline Corporate Database

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