PNB Housing Finance's Growth Will Sustain On Strong Demand, Says CEO Girish Kousgi
Despite challenges like general elections, heat waves, and changes in state registration processes, PNB Housing Finance surpassed its annual guidance of 17% growth on the retail book, said Chief Executive Officer and Managing Director Girish Kousgi.
Housing demand is set to remain strong over the next five-six years, supported by growth across all segments, including super prime, prime, emerging, and affordable, Kousgi said. "Barring temporary challenges, demand is intact and sustainable," he told NDTV Profit.
PNB Housing Finance on Tuesday reported a 43% rise in net profit to Rs 483 crore for the December quarter. Total income during the third quarter of the current fiscal grew to Rs 1,943 crore from Rs 1,756 crore in the year-ago period, PNB Housing Finance said in a regulatory filing.
The company has been transforming its operations, exiting the super prime segment due to margin constraints and focusing on affordable housing. Launched in January 2023, the affordable segment doubled its book to Rs 3,838 crore within nine months, with a target of Rs 5,800 crore by March 2025. Additionally, the retail book is expected to reach Rs 1 lakh crore by fiscal 2027.
PNB Housing Finance has also been expanding its footprint, increasing its branch network from 100 to 305 in two years, with plans to reach 350 branches by March. "We have added new verticals, expanded branches, and strengthened our team. Combined with robust real estate demand, the industry is poised for growth," Kousgi explained.
Looking ahead, Kousgi projected steady-state ROAs of 2.5-2.6%, credit costs at 25 basis points, and growth at 1.5 times the industry rate. Recovery efforts have also been notable, with Rs 130 crore recovered in the first nine months of fiscal 2024 and an expected Rs 180-190 crore by year-end.
"The contribution from affordable and emerging will increase. We will be starting corporate, as well. So, all of these things will ensure that we will be more profitable and ROA will be maintained," he said.
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