
We interacted with Repco Home Finance’s Management to understand the drivers of loan growth acceleration, factors which will influence portfolio spread/NIM, and actions taken to consistently reduce the overdue portfolio and NPLs. The management was quite confident about achieving the guided disbursements of Rs40bn in the current year and reaching 12% loan book growth, managing spread decline within 15-20 bps, and improving GNPL ratio to 2.5% by the year-end. Repco trades at an undemanding valuation of 6x P/E and 0.7x P/BV on FY27 estimates, and acceleration of loan growth and further improvement in asset quality should re-rate the stock. We have a BUY rating with a 12m PT of Rs560
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