PNBHOUSING - Investment Analysis

Last Updated Time : 02 Aug 25, 12:58 am

Investment Rating: 4.1

📊 PNB Housing Finance Ltd (PNBHOUSING) — Long-Term Investment Analysis

✅ Strengths

Low P/E (12.9) vs Industry PE (20): Indicates undervaluation.

PEG Ratio (0.40): Strong signal of undervaluation relative to earnings growth.

ROE (12.2%) & ROCE (9.44%): Decent capital efficiency for a housing finance NBFC.

EPS (₹78.4): Solid earnings base.

Strong Institutional Interest: FII (+2.73%) and DII (+8.11%) holdings increased.

Affordable Housing Growth: 143% YoY growth in this segment

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Capital Adequacy: CRAR at 29.26% — well above regulatory norms

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⚠️ Weaknesses

High Debt-to-Equity (3.70): Typical for NBFCs, but adds risk.

Dividend Yield (0.50%): Low for income-focused investors.

Leadership Uncertainty: CEO Girish Kousgi’s resignation triggered a sharp 18% stock drop

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Technical Weakness: RSI at 30.2 and MACD negative — oversold but bearish.

📈 Ideal Entry Price Zone

Current Price: ₹808.45

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52-Week Range: ₹746.70 – ₹1,202.20

Suggested Entry Zone: ₹780 – ₹850

RSI near 30 suggests oversold territory.

Forward PE of 12.9 and fair value estimates around ₹1,100–₹1,244

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support upside.

🧭 Long-Term Investment Outlook

PNB Housing is a strong long-term candidate if leadership transition is smooth. Its focus on affordable housing, digital transformation, and asset quality improvement positions it well for compounding returns.

Price Targets (Based on Forecast Models)

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Year Target Range (₹)

2025 ₹860 – ₹910

2026 ₹915 – ₹980

2027 ₹990 – ₹1,050

2030 ₹1,200 – ₹1,220

🛣️ Exit Strategy (If Already Holding)

If Bought Above ₹1,000

Exit near ₹970–₹996 on rallies

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Reassess post-CEO transition and Q2 earnings.

If Bought Below ₹850

Hold for 3–5 years, targeting ₹1,200+.

Consider partial profit booking near ₹1,050–₹1,100.

Monitoring Metrics

CEO succession and strategic continuity

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ROE/ROCE trend (target >13%)

GNPA levels (currently 1.06%)

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Affordable housing loan growth

Would you like a comparison with peers like LIC Housing Finance or Can Fin Homes to evaluate sector positioning?

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