PNB Housing Finance slipped 1.86% to Rs 543.15 after a foreign brokerage reportedly initiated 'sell' rating on the stock with a price target at Rs 458.The brokerage reportedly noted that PNB Housing had structural challenges that could lead to sub-optimal returns, lack of visibility on bottoming of asset quality and erosion of competitive advantage to limit ability to gain market share.
On 7 November 2019, PNB Housing Finance raised Rs 2500 crore from LIC through the issue of secured redeemable nonconvertible debentures (NCDs) for a tenure of 10 years.
The housing finance company's consolidated net profit 45% to Rs 366.81 crore on a 23.3% increase in total income to Rs 2230.34 crore in Q2 September 2019 over Q2 September 2018.
PNB Housing Finance's asset base comprises of retail loans and corporate loans. The retail business focusses on organized mass housing segment financing for acquisition or construction of houses. Corporate loans are mainly to developers for construction of residential / commercial properties, corporate term loans and lease rental discounting. The company is a deposit taking housing finance company.
On the technical front, the stock's RSI (relative strength index) stood at 48.60. The RSI oscillates between zero and 100. Traditionally the RSI is considered overbought when above 70 and oversold when below 30.
The stock trades below its 50-day and 200-day moving average (DMA) placed at Rs 547.45 and Rs 731.40 respectively.
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