LIC Housing Finance - March 2013 Results Preview - Motilal Oswal

- LICHF's loan growth is likely to remain healthy on the back of buoyant demand in individual loans segment coupled with increased sanctions/disbursements in the developer loan portfolio. The builder loan portfolio too is expected to go up. We expect loan growth to remain healthy at ~24% YoY and ~8% QoQ.

- We expect margins to expand by ~10bp QoQ, led by some moderation in cost of funds, which should provide a cushion to margins.

- Asset quality is likely to remain stable. We model a provisioning expense of ~INR294m (v/s write-back of INR200m worth excess provisions in 4QFY12 on account of change in the standard asset provisioning requirement by NHB) for the quarter.

- We expect net profit to grow at 3.1% YoY to INR2.61b.

- The stock trades at1.5x FY14E and 1.3x FY15E BV. Maintain Buy.

Source : Equity Bulls

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