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This Article is From Apr 03, 2025

NBFCs Q4 Results Preview: Growth To Be Slow; Cost Of Borrowing To See A Gradual Reduction, Says Nirmal Bang

Nirmal Bang prefer Home First Finance and PNB Housing in housing finance space.

NBFCs Q4 Results Preview: Growth To Be Slow; Cost Of Borrowing To See A Gradual Reduction, Says Nirmal Bang
Nirmal Bang expects slowdown in the vehicle finance portfolio for Cholamandalm and Shriram Finance to be offset by diversified segments such as home loan/ loan against property/ MSME. (Photo source: Usha Kunji/ NDTV Profit)
STOCKS IN THIS STORY
Poonawalla Fincorp Ltd.
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Sundaram Finance Ltd.
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Repco Home Finance Ltd.
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Bajaj Housing Finance Ltd
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PNB Housing Finance Ltd.
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LIC Housing Finance Ltd.
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Can Fin Homes Ltd.
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Aavas Financiers Ltd.
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Mahindra Holidays & Resorts India Ltd.
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Cholamandalam Investment & Finance Company Ltd.
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Shriram Finance Ltd.
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Home First Finance Company India Ltd
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In Nirmal Bang's view, the following will be key monitorables from Q4 FY25 results– FY26 growth guidance, NIM movement in subsequent quarters and the gradual reduction in CoF, Asset quality trends.

NDTV Profit's special research section collates quality and in-depth equity and economy research reports from across India's top brokerages, asset managers and research agencies. These reports offer NDTV Profit's subscribers an opportunity to expand their understanding of companies, sectors and the economy. 

Nirmal Bang Report

Expect commercial vehicle financiers to see improving fleet occupancy levels (year-end/ stocking of summer goods). Diversified players (Cholamandalam, Shriram Finance) are likely to perform better. Growth in the used CV portfolio and a gradual reduction in cost of fund is likely to support margins. Asset quality trends are a key monitorable.

We expect lukewarm disbursements for housing financiers on account of issues in Karnataka/ Telangana. Expect net interest margin to remain range-bound. Prefer Home First Finance and PNB Housing in the space.

Credit costs are likely to be on the higher side due to stress in MFI/unsecured loans.

In our view, the following will be key monitorables from Q4 FY25 results–

  1. FY26 growth guidance,

  2. NIM movement in subsequent quarters and the gradual reduction in CoF,

  3. Asset quality trends.

Click on the attachment to read the full report:

Nirmal Bang NBFC-Sector--4QFY25-Result-Preview--2-April-2025.pdf
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DISCLAIMER

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