This smallcap housing financier spurts 20% on credit rating upgrades

Shares of the housing financier PNB Housing Finance were locked in the 20 per cent upper circuit at Rs 755.15 apiece towards the close of the session on Monday, April 1. Nevertheless, at the close, shares were dragged a little and ended higher by over 19 per cent at Rs 749.55 apiece on the BSE.

The stock saw a massive rally following the company’s exceptional achievement of securing three consecutive credit rating upgrades in a single quarter (Q4 FY24). India Ratings, ICRA, and CARE Ratings affirmed and upgraded the company’s ratings to ‘AA+’ from ‘AA’ with a ‘Stable’ outlook.

The rating rationale factors in PNB Housing Finance’s improved asset quality, strong market position, diversified resource profile, and efficient capital management, the company’s release said.

Additionally, the rating agencies recognised the company’s sharpened focus on the granularisation of the retail loan book, along with the expansion of the affordable housing segment to ensure higher yields and interest margins and improve profitability.

Shares of the company have gained nearly 86 per cent from their 52-week low price of Rs 406.7. The stock in the past one year has gained 56 per cent, outperforming the Nifty index, which delivered nearly 33 per cent.

Commanding a m-cap of Rs 19,468 crore, the company provides housing loans to individuals and corporate bodies for construction, purchase, repair, and upgradation of houses. It also provides loans for commercial space and loan for purchase of residential plots.