PNB Housing Finance Limited IPO Views - 21st Oct 2016

Banking | Published on Oct 21st 2016


PNB Housing Finance (PNBH) has been one of the fastest growing Housing Finance Companies and is currently the 5th largest player in India. Strong Brand name of PNB & efficient management has helped in growing the business much ahead of industry. With 49% stake being held by Pvt Equity Major Carlyle group, PNBH is all set to scale up its operations. PNBH has delivered RoE of 17.6% on the pre issue net worth. While the IPO will result in RoE compression, this will give the much required fund for growth. At the upper price band the issue is offered at 4.6x its FY16 BV. However at the post issue BV of Rs311, it is offered at 2.5x. PNBH is all geared up for its next leg of growth and has the potential to become a significant player in the Indian mortgage business. Looking at the quality of management which can drive the growth we recommend a SUBSRIBE to the issue.

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