Q1 2027 LIC Housing Finance Ltd Earnings Call Transcript
Key Points
- Disbursements grew 14.5% YoY to INR15,014 crore, in line with the company's 15% guidance, driven by strong growth in individual home loans (8%) and non-housing loans (20%).
- Profit after tax increased 9.4% YoY to INR1,488.32 crore, supported by an 11% rise in profit before tax.
- Asset quality improved, with Stage 3 exposure down to 2.14% from 2.62% YoY, and the company expects further improvement to below 2% by year-end.
- Cost of funds declined 22 bps YoY to 7.28%, reflecting prudent liability management and diversified borrowing, despite a stable rate environment.
- The company is actively diversifying into higher-yielding segments like LAP and LRD, with a target of INR15,000 crore disbursements this year, and plans to launch co-lending and direct assignment to boost growth.
- AUM growth remained subdued at 4% YoY, with individual home loan portfolio growth also at 4%, reflecting ongoing competitive pressures and high prepayments.
- Net interest margin (NIM) declined to 2.58% from 2.68% YoY, falling slightly below the lower end of the guided range, due to rate cuts and competitive pricing.
- Net interest income growth was minimal at 0.5% YoY, and non-interest income was impacted by an accounting change that reclassified recoveries from written-off accounts.
- The company faces intense competition from banks, leading to higher balance transfer (BT) outflows, with net BT-out at INR1,500 crore in Q1.
- Credit costs, though negative this quarter, are expected to rise to 10-15 bps for the full year, and the company's incremental yield on new disbursements (8.25%) is significantly lower than the portfolio yield (9.12%), indicating potential margin pressure.
Ladies and gentlemen, good day, and welcome to the LIC Housing Finance Q1 FY27 investor conference call hosted by Axis Capital. (Operator Instructions) Please note that this conference is being recorded.
I now hand the conference over to Mr. Praveen Agarwal. Thank you, and over to you, sir.
Thank you, Ara. Good day, everyone, and welcome to the earnings call of LIC Housing Finance. From the management team, we have Mr. Tribhuwan Adhikari, MD and CEO; Mr. Sandeep Kumar, CEO; and Mr. Lokesh Mundhra, CFO. I would request Mr. Adhikari to share his opening remarks, post which we'll open the floor for Q&A.
Over to you, sir.
Thank you, Praveen. Very good morning, and welcome to all of you to the post earnings conference call of LIC Housing Finance Limited. As you are aware, LICHFL declared its Q1 FY27 results yesterday. Before discussing our
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