Business Standard

LICHFL Q2 net rises 12% to Rs 573.2 cr; loans grow 30%

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Press Trust of India Mumbai
LIC Housing Finance (LICHFL) Monday reported a tepid 12 per cent growth in September quarter net at Rs 573.16 crore despite a robust loan growth that clipped past 30 per cent.
The housing finance arm of the national insurer LIC said its loan disbursements rose 30 per cent to Rs 14,272 crore, taking the total outstanding loan portfolio to Rs 1,75,953 crore by the end of the reporting period, a growth of 16 per cent.
Chief executive and managing director Vinay Sah attributed the 30 per cent loan growth to an exceptionally high level of disbursals in the last month of the quarter (September) and said for the first half, the loan growth was only 21 per cent.
He also said this level of growth is not sustainable and expects to close the year with a 17-18 per cent growth.
On the margin compression to 2.35 per cent from 2.58 per cent year-on-year, Sah told PTI that Q3 and Q4 margins should be better as the impact of increasing the prime lending rates four times or a cumulative 60 bps so far this year will be reflected going forward.
While it had increased the lending rates twice in Q1, it had increased the same once in Q2 and the fourth hike is effective October 1. "This should help us clock better margins in the second half," said Sah.
Asked whether the company has any liquidity issue, he answered in the negative and described the same as "comfortable" and said the company has no exposure to the crippled IL&FS group.
On the margin compression and the prevailing high cost of funds, he said LICHFL has in fact seen its cost of funds coming down a bit on an average but incrementally it has gone by a bit.
The company meets over 70 per cent of its growth capital from non-convertible debentures (NCDs), while bank funding is only around 18 per cent. The rest is met through commercial papers.
Since the beginning of this fiscal, it has raised Rs 3,000 crore from NCDs.
The individual loan portfolio, which comprises 94 per cent of the total portfolio, grew 13.5 per cent to Rs 1,65,102 crore, from Rs 1,45,486 crore, Sah said.
Commenting on the performance, he said, "We've seen strong disbursal growth and expect the trend to continue in the future. We saw a strong growth in affordable segment loans and is poised to continue this growth trajectory."

He also said the company has no liquidity crisis, and termed the same as "comfortable".
Net interest income grew to Rs 1,012 crore from Rs 963 crore for the same period previous year, while the key net interest margin stood at 2.35 per cent, against 2.58 per cent a year ago and 2.34 per cent in the June quarter.
Revenue from operations grew 12 per cent to Rs 4,198 crore, taking total income to Rs 4,203 crore, a growth of 12 per cent.
Of the total disbursements of Rs 14,272 crore, retail loans were Rs 11,324 crore, against Rs 10,367 crore, and project loans were Rs 2,948 crore, against Rs 608 crore.
The company continues to witness good growth in the affordable housing segment with the segment accounting for 16 per cent of the total disbursements in terms of number of accounts and 13.5 per cent in terms of amount of disbursements during the quarter under review, the company said.
As per the NHB norms, gross non-performing assets (NPAs) stood at 1.20 per, while same in the individual segment was 0.81 per cent. Overall gross NPAs stood at 1.21 per cent.
The LICHFL counter closed up 2.91 per cent to Rs 417.10 on the BSE, against the benchmark Sensex rallying 2.15 per cent of 718 points, after bleeding for weeks.

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First Published: Oct 29 2018 | 7:35 PM IST

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