HSBC begins coverage of India's Bajaj Housing with 27% downside forecast

Bajaj Housing Finance

04/10/2024 10:56

** Shares of Bajaj Housing Finance  BAJO.NS  slip 0.3%, set
to fall for a fifth straight session
    ** HSBC Research initiates coverage of stock with a "reduce"
rating and a TP of 110 rupees, implying a 27% downside to its
last close
    ** Sees pressure on return on assets due to likely margins
compression and moderation in earnings growth, in both home loan
and non-home loan segments
    ** Brokerage forecasts BAJO's AUM growth slowing to 26% CAGR
over FY24-27, from 34% in FY21-24
    ** EPS growth to also drop to 17% compared to 41%
    ** Stock down 9% since closing at 165 rupees on listing day
    ** Since BAJO's listing, rival PNB Housing  PNBH.NS  is down
16.5%, while LIC Housing  LICH.NS  has fallen by 12.5%

 (Reporitng by Nishit Navin)
 ((nishit.navin@thomsonreuters.com;))