CANFINHOME - Fundamental Analysis: Financial Health & Valuation

Last Updated Time : 19 Sept 25, 2:16 pm

🧠 How I’m Thinking About This

You’re asking for a full-spectrum fundamental analysis of Can Fin Homes Ltd (CANFINHOME), a Canara Bank-sponsored housing finance company. I’m evaluating its financial strength, valuation metrics, business model, and technical indicators to determine its long-term investment potential and ideal entry point.

📊 Core Financials Breakdown

Profitability & Growth

EPS: ₹66.2 — strong earnings base

PAT Qtr: ₹224 Cr vs ₹234 Cr — -4.3% QoQ, but +12.1% YoY — steady growth

ROE: 18.2%, ROCE: 9.34% — solid return on equity, but ROCE slightly below peers

Debt-to-equity: 6.92 — high, typical for NBFCs with loan books

Dividend & Cash Flow

Dividend Yield: 1.55% — attractive for a financial stock

Consistent payout supported by stable net interest margins and low NPAs

💰 Valuation Indicators

Metric Value Interpretation

P/E Ratio 11.7 Undervalued vs industry PE of 19.9

P/B Ratio ~2.04 Reasonable premium to book value

PEG Ratio 0.53 Attractive — valuation aligns well with growth

Intrinsic Value ~₹760–₹780 Trading near fair value

Valuation is compelling, especially with a low PEG ratio and strong earnings visibility.

🏠 Business Model & Competitive Edge

Industry: Housing finance — regulated, demand-driven

Moat

Strong presence in Tier 2 and Tier 3 cities

Focused loan book with low delinquency

Backed by Canara Bank — credibility and funding access

Catalysts

Affordable housing demand and government incentives

Expansion into new geographies and digital lending platforms

Analyst consensus suggests a 1-year target of ₹895 — ~15% upside

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Can Fin Homes is a steady compounder with a clean book and strong underwriting discipline.

📉 Technical & Entry Zone

Current Price: ₹776

DMA 50/200: Trading slightly above both — neutral to mildly bullish

MACD: +1.82 — positive momentum

RSI: 57.9 — neutral zone

📌 Suggested Entry Zone: ₹760–₹780

This range aligns with intrinsic value and technical support. Accumulate on dips for long-term exposure.

🕰️ Long-Term Holding Guidance

Hold if already invested, especially for consistent earnings and dividend yield

Buy on dips near ₹765 if bullish on housing finance and rural credit growth

2026 Target Price: ₹895–₹925 based on analyst consensus and sector tailwinds

2030 Forecast: ₹1,200+ if loan book and margins scale as projected

⭐ Fundamental Rating

4.4

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