HUDCO - Fundamental Analysis: Financial Health & Valuation

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

🧠 My Thought Process

You're looking for a full-spectrum fundamental analysis of HUDCO (Housing and Urban Development Corporation Ltd), with a numeric rating and strategic investment guidance. I’ve weighed profitability, capital efficiency, valuation, and business durability, and incorporated the latest financial updates from September 2025

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📊 Fundamental Analysis of HUDCO

🔍 Core Financials

Profitability

PAT Qtr: ₹630 Cr vs ₹728 Cr — slight decline, but annual PAT rose to ₹2,709 Cr in FY25

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EPS: ₹13.9 — decent for a PSU lender.

ROE: 15.7%, ROCE: 9.62% — solid returns, though ROCE is modest.

Leverage & Liquidity

Debt-to-equity: 5.97 — high, typical for infra-financing NBFCs; manageable due to sovereign backing.

Dividend Yield: 1.86% — attractive, with recent payouts of ₹1.05 and ₹2.05 per share

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Cash Flow

Revenue for Q1 FY25: ₹2,937 Cr, up from ₹2,845 Cr in Q4 FY24

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Annual revenue surged to ₹10,311 Cr in FY25 from ₹7,784 Cr in FY24 — strong growth trajectory

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📉 Valuation Indicators

Metric Value Interpretation

P/E Ratio 16.0 Undervalued vs industry PE of 25.3

P/B Ratio ~2.48 Reasonable given ROE and dividend yield

PEG Ratio 0.98 Fairly valued based on growth

Intrinsic Value ~₹240–₹250 Slight upside from current price

🏗️ Business Model & Competitive Edge

Segment Focus: Financing housing and urban infrastructure — roads, water, sanitation, and smart cities.

Moat: Government backing, long-term project pipeline, and strategic MoUs (e.g., with Nagpur Metropolitan Region Development Authority)

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Growth Drivers

Targeting ₹3 lakh Cr in infra finance by 2030

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Strong sanction growth: ₹1.28 lakh Cr in FY25 (↑55% YoY)

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Expanding footprint in Tier 2/3 cities and state-level partnerships.

📈 Technical & Entry Guidance

Current Price: ₹223

DMA 50/200: ₹218 / ₹220 — trading near support levels.

RSI: 61.0 — mildly bullish.

MACD: 1.93 — positive momentum.

🎯 Entry Zone

Ideal Buy Range: ₹210–₹220 — near DMA support.

Stop Loss: ₹195

Target: ₹250–₹260 in medium term

🕰️ Long-Term Holding Outlook

Hold if invested: Strong fundamentals, dividend payouts, and infra push justify long-term holding.

Buy on dips: Especially near ₹215 zone.

Growth Triggers: Infra finance expansion, MoUs with state bodies, and dividend continuity.

⭐ Fundamental Rating

4.4

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Moneycontrol

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The Statesman | MSN

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Mint | MSN

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News18

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