Repco Home Finance Reports 34% PAT Growth in 9M-24

1. Non-Banking Finance Company - Housing Finance Company

2. FY19-23: No clear growth trajectory

3. Strong FY23: PAT up 55% and Revenue down 1% YoY

4. Strong H1-24: PAT up 40% & Revenue up 21% YoY

5. Strong Q3-24: PAT up 23% & Revenue up 18% YoY

PAT up 1% & Revenue up 2% QoQ

6. Strong 9M-24: PAT up 34% & Revenue up 20% YoY

7. Business metrics: Improving return ratios

8. Outlook: 18% PAT growth in FY24

i. FY24: On-track to deliver as per guidance

Guidance:

• Way forward, for the next year, we plan to grow sanctions and disbursements by 20%, and achieve an AUM growth of 12% on a conservative basis.

• The GNPA numbers are planned to be brought down by at least INR100 crores during FY ‘23-‘24.

ii. FY24: On-track to deliver 18% PAT growth

Profit guidance of Rs 350 cr in FY24 implies an 18% growth over the FY23 PAT of Rs 296 cr.

Our profit guidance was 350 Crores for the whole year and we have achieved 187 Crores in the first half.

ii. FY27: Roadmap to 14% AUM growth CAGR

AUM expected to grow from Rs 13,5000 cr as of FY24 end to Rs 20,000 cr by FY27 at a CAGR of 14%

Before we present current quarter performance, we would like to inform that our Board in it's yesterday's meeting has approved 3-year broad road map of reaching an AUM of at least INR20,000 crores by 2027, with an addition of 40 branches per year. The GNPA is expected to grow below 2% by then

9. PAT growth of 34% & Revenue growth of 20% in 9M-24 at a PE of 6

10. So Wait and Watch

If I hold the stock then one may continue holding on to REPCOHOME

• Based on 9M-24 performance, REPCOHOME looks on track to deliver the strongest PAT in FY24

• On an annual run rate REPCOHOME is on track to deliver as per the guidance set out by the management.

We had planned a reduction of INR100 crores of GNPA for the entire financial year, against which we have already achieved INR101 crores in a span of 9 months. Our profit guidance was INR350 crores for the whole year, and we have so far achieved INR287 crores in the 9 months. We are confident of surpassing the target for the year.

• REPCOHOME is in the middle of a strong run. For all the three quarters of FY24, REPCOHOME has delivered QoQ growth in PAT.

11. Or, join the ride

If I am looking to enter REPCOHOME then

• REPCOHOME has delivered PAT growth of 34% & Revenue growth of 20% in H1-24 at a PE of 6 which makes valuations quite reasonable.

• Outlook for bottom-line growth of 18% for FY24 at a PE of 6 makes the valuations quite reasonable.

• With a market cap Rs 2452 cr against a net worth of Rs 2569.9 cr as of Q3-24 end implies that REPCOHOME is available a price to book of 0.95 which makes the valuations quite attractive