LIC Housing posts weak Q1 results; JM Financial, MOFSL share stock strategy

LIC Housing Finance share price today: Shares of LIC Housing Finance are in focus after the company reported its June 2025 quarter (Q1FY26) results. The stock fell nearly 3 per cent on Tuesday, on the NSE, to touch an intraday low of ₹575.2. 

 

At 1 PM, LIC Housing Finance was trading 2.04 per cent lower at ₹579 on the NSE. In comparison, the NSE Nifty50 was trading 0.34 per cent lower at ₹24,638.55. The stock has crashed around 20 per cent from its 52-week high of ₹35.55 touched on September 16, 2024.   READ STOCK MARKET LATEST UPDATES LIVE

LIC Housing Finance Q1 results

In the June 2025 quarter, LIC Housing Finance posted revenue from operations of ₹7,233.13 crore, up 7 per cent from ₹6,783.67 crore in the year-ago period. Net interest income (NII) grew 6 per cent year-on-year (Y-o-Y) to ₹5,047.28 crore in Q1FY26 from ₹4,750.05 crore in Q1FY25. 

 

 

The company's net profit came in at ₹1,359.92 crore, up 5 per cent from ₹1,300.21 crore in the year-ago period. 

 

In the reported quarter, the company's loan distursements witnessed a marginal growth to ₹13,116 crore compared to ₹12,915 crore in the year-ago period. Net interest margins (NIM) for the quarter slipped to 2.68 per cent against 2.6 per cent in Q1FY25.   ALSO READ | MSCI August rejig: Vishal Mega, Swiggy among entrants; $1 bn inflows likely

Should you buy, sell, or hold LIC HFL post Q1? 

According to analysts at Motilal Oswal Financial Services (MOFSL), LIC Housing Finance delivered an operationally soft quarter, with subdued loan growth and disbursements. Asset quality weakened, mainly due to seasonal factors and some slippages in collections, as seen in the sequential rise in its 30+ dpd loans. Margins also came under pressure, primarily from lower yields after the recent repo rate reductions.

 

"We believe that the declining interest rate environment, coupled with an intensifying aggression from banks (particularly in the super prime segment), will weigh on LICHF’s loan growth and the consequent trade-off with margins. LIC Housing Finance's valuation of 0.7x FY27E P/BV reflects the inability of the franchise to deliver stronger loan growth," the brokerage said.

 

MOFSL maintained a 'Neutral' rating on the stock with a target price of ₹650, based on 0.8x March 27E book value.

 

Analysts at JM Financial believe that the decline in yields going forward will be partially offset by high-yielding affordable segment growth, leading to healthy net interest margins (NIMs), while the recovery pipeline will aid lower credit costs. 

 

The brokerage expects LIC HF to deliver average return ratios of 1.6/14 per cent RoA/RoE over FY26E/FY27E. JM Financial maintained a 'Buy' on the stock with an unchanged target price of ₹685, valuing at 0.8x FY27E BVPS.