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Apr-Jun 2013 Earnings Preview
IDFC
Rating
BUY
Price (Rs) 126
Target Price (Rs) 150
M/Cap (Rs bn) 191.0
Shares o/s (m) 1,512.4
Key Figures (Rs m)
Y/e March FY13 FY14E FY15E
Net Op. Inc. 34,690 38,073 43,098
NII 25,492 28,250 32,150
PPP 29,440 32,153 36,456
PAT 18,370 21,494 24,327
EPS (Rs) 12.1 14.2 16.1
Growth (%) 18.2 17.0 13.2
NIM (%) 3.9 3.8 3.8
RoE (%) 14.1 14.8 14.9
PE (x) 10.4 8.9 7.9
P / BV (x) 1.4 1.3 1.1
We expect IDFC to report a PAT growth of ~31% YoY largely due to a low base. Loan
growth is seasonally weak in Q1 and with slower Infra disbursals, we expect reported
loan growth of ~14% YoY. Falling rates should help offset any NIM pressure from
higher share of re-financing. Management guidance indicates no large negative
surprises in asset quality but credit costs will continue to remain elevated as IDFC
ramps up provisioning buffer.
Quarterly Table (Rs m)
Y/e March
Q1
FY14E
Q1
FY13
YoY gr.
(%)
Q4
FY13
12M
FY14E
12M
FY13
YoY gr.
(%)
Net Operating Inc. 9,141 7,660 19.3 10,090 38,073 34,690 9.8
NII 6,741 6,290 7.2 6,430 28,250 25,492 10.8
Non Interest Inc. 2,400 1,370 75.2 3,660 9,823 9,198 6.8
PPP 7,889 6,490 21.6 8,580 32,153 29,440 9.2
PAT 4,960 3,800 30.5 5,260 21,494 18,370 17.0
Operating Metrics
NIM 4.1 4.3 (28)bps 4.1 3.9 4.1 (17)bps
Disbursements 35,116 45,020 (22.0) 46,240 217,370 195,976 10.9
Credit Cost 0.6 0.7 (8)bps 1.0 0.4 0.7 (25)bps
Loans 571,294 501,570 13.9 557,360 635,390 557,360 14.0
LIC Housing Finance
Rating
BUY
Price (Rs) 225
Target Price (Rs) 315
M/Cap (Rs bn) 113.5
Shares o/s (m) 505.0
Key Figures (Rs m)
Y/e March FY13 FY14E FY15E
Net Op. Inc. 17,343 21,886 26,802
NII 15,345 19,653 24,203
PPP 14,524 18,511 22,824
PAT 10,231 13,019 16,066
EPS (Rs) 20.3 25.8 31.8
Growth (%) 11.9 27.2 23.4
NIM (%) 2.2 2.3 2.3
RoE (%) 16.8 18.6 19.7
PE (x) 11.1 8.7 7.1
P / BV (x) 1.8 1.6 1.4
We expect LICHF to report a PAT growth of ~36% YoY as spreads recover. We factor
in spreads of ~125bps v/s 110bps reported in Q3FY13 and ~140bps reported in
Q4FY13. There will be release of provisioning from the “Fix-O-Floaty” book but LICHF
is likely to retain that as excess provisions and will not write that back through the
P&L.
Quarterly Table (Rs m)
Y/e March
Q1
FY14E
Q1
FY13
YoY gr.
(%)
Q4
FY13
12M
FY14E
12M
FY13
YoY gr.
(%)
Net Operating Inc. 4,826 3,999 20.7 5,074 21,886 17,343 26.2
NII 4,282 3,505 22.2 4,608 19,653 15,345 28.1
Non Interest Inc. 544 494 10.0 466 2,233 1,998 11.8
PPP 4,211 3,479 21.1 4,128 18,511 14,524 27.5
PAT 3,095 2,277 35.9 3,162 13,019 10,231 27.2
Operating Metrics
Credit Cost 0.0 0.3 (27)bps (0.0) 0.1 0.1 1 bps
Loans 809,245 656,440 23.3 778,120 945,256 778,120 21.5
NIM 2.2 2.2 (1)bps 2.5 2.3 2.2 10 bps
Builders Loans % 3.3 4.6 (133)bps 3.4 3.8 3.4 38 bps
July 8, 2013 74