Can Fin Homes Q1 Review – Asset Quality Remains Pristine; Yields Soften With Re-Pricing: Motilal Oswal

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Can Fin Homes Ltd.’s Q1 FY22 profit after tax was up 17% y-o-y to Rs 1.09 billion (estimate- Rs 1.04 billion).

The quarter was characterised by low disbursements (due to lockdowns), high operating efficiency, and strong asset quality resulting in low credit cost.

Net interest income stood at Rs 1.8 billion (3% miss) and declined 5% y-o-y /2% q-o-q on sharp contraction in yields.

Credit cost at Rs 65 million (our estimate: Rs 200 million) was benign; it utilised Rs 370 million of additional management overlay towards the provision on the restructured pool of loans (less than 2% of the total advances).

Can Fin Homes’ management guidance that the spread and net interest margins have bottomed out is outright encouraging.

Click on the attachment to read the full report:

Motilal Oswal CanFin Homes Q1FY22 Result Update.pdf


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