October 2, 2025
rakesh_jhunjhunwala_at_work
All savvy investors are making a bee-line for stocks of housing finance companies on the basis that they will be the beneficiaries of dual factors of NAMO’s 100-cities push and the interest rate cuts. UBS has provided valuable guidance on why these stocks will shine
All savvy investors are making a bee-line for stocks of housing finance companies on the basis that they will be the beneficiaries of dual factors of NAMO’s 100-cities push and the interest rate cuts. UBS has provided valuable guidance on why these stocks will shine




Rakesh Jhunjhunwala, the Badshah of Dalal Street, saw it coming way before anyone else. He was the first in queue in October 2013 to grab a truckload of Dewan Housing Finance stock at the throwaway price of about Rs. 130. He advised his disciples to do the same on the basis that Dewan Housing Finance is an “undervalued stock” and that the market size is at least “500 times” larger. “I am very bullish on the housing finance business” the Badshah declared with authority.

Rakesh Jhunjhunwala was perfectly correct in his analysis because Dewan Housing is up 250% since then.

Basant Maheshwari put his money on Repco Home Finance in December 2013. He has also reaped a rich harvest of nearly 100% from the stock.

Mohnish Pabrai is the latest to jump into the fray with a purchase of GIC Housing Finance stock.

Now, UBS has offered valuable guidance on why housing finance stocks will shine. The wizards there point out that HFCs will be the biggest beneficiaries among non-banking financial companies (NBFCs) as cost of funds may fall faster than lending rates. UBS expects wholesale rates to further decline, with 10-year G-Sec rates touching 6.5 percent by March 16 (versus 7.9 percent now) which may translate into 100-150 basis points (bps) decline in banks’ lending and deposit rates. With easing liquidity and lower inflation, wholesale rates have fallen faster than retail term deposit rates with 3 year AAA rates declining by 130 basis points year-to-date (YTD). This, according to UBS, will benefit HFCs the most. “Mortgage growth has remained resilient for leading HFCs and we expect growth to remain strong at 19-20 percent over FY16-17E. Loan growth in non-mortgage segment has been subdued but this should pick up in H2FY15/FY16. This coupled with improvement in margins would boost earnings growth of HFCs,” UBS said.

UBS has indicated that its favourite stocks are LIC Housing Finance with a target price of Rs 550 per share and Indiabulls Housing Finance with a target price of Rs 575.

If you want more research reports, you can read up Nirmal Bang’s report on Dewan Housing Finance and Motilal Oswal’s report on IndiaBulls Housing Finance.

2 thoughts on “After Rakesh Jhunjhunwala, Mohnish Pabrai & Basant Maheshwari, Even UBS Is Bullish About Housing Finance Stocks

  1. Hi,

    If you are tracking these stocks or have any link on latest research on any of these stocks?

    Ashoka Alco chemicals
    Ashapura Minechem
    Guj NRE coke

    Which one is the best and targets if any?

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