LIC Housing Finance shares jump almost 15% amid robust Q3 earnings; know brokerages view here

On the back of healthy third-quarter earnings of this fiscal, the shares on LIC Housing Finance surged almost 15 per cent to touch a day’s high of Rs 396.65 per share on the BSE intraday trade on Friday. 

The company reported a 6 per cent year-on-year growth in profit after tax at Rs 767.33 crore for the October-December quarter of the financial year 2021-22 (Q3FY22) as compared to Rs 727.04 crore in a year-ago quarter. The Q3 profit was aided by higher collections and a drop in provisions. 

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While the net interest income (NII) of LIC Housing grew 14 per cent to Rs 1,455 crore, as against Rs 1,281 crore for the same period in a year-ago quarter. Similarly, the net interest margin (NIM) improved to 2.42 percent as against 2.36 percent. 

According to the company’s Managing Director and CEO Y Viswanatha Gowd, “The income levels were more or less maintained. Our collections were good during the three months of the quarter.” 

The company’s recovery also picked up across all the regions. Even the provisions were less in the quarter because of the provisions we had made earlier, Gowd added in a filing to exchanges. 

The global brokerage firm Morgan Stanley maintained an Underweight stance on LIC Housing. It mentioned the company’s Q3 profit was in-line given higher provisions towards new the Reserve Bank of India norms. PPoP 15 per cent above estimates, was driven by stronger NII, the brokerage said. 

The stock at around 12:40 pm is trading over 14 per cent higher to Rs 395 per share on the BSE, as compared to a 1.33 per cent rise in the S&P BSE Sensex.  

LIC Housing Finance is a direct beneficiary of the in-process Life Insurance Corporation of India’s Initial Public Offering. The parent company is likely to launch its IPO by this fiscal end, as speculated by several analysts and brokerage houses.