LIC Housing Finance: 34% boom in net profit

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LIC Housing Finance shares surged as much as 11.45 per cent, the most in a day since May 26, to hit an intraday high of ₹ 308 a day after it reported its June quarter earnings. The country’s leading non-banking finance company after market hours on Monday reported that its net profit in June quarter rose 34 per cent to ₹ 817 crores despite disruptions caused by Covid-19 induced disruptions. Overall provisions declined 77.69% to Rs 56.5 crore, compared with Rs 253 crore in the same length a year ago. The company’s net interest income or the difference between interest earned and interest expended came in at ₹ 1,221 crores as against ₹ 1,182 crores, LIC Housing Finance said in a press release. 

LIC Housing Finance Ltd. (LIC HFL) is one of the largest housing finance companies in India. It offers monetary support to anyone who wants to buy or construct a house through several products under LIC home loan category. LIC home loans can also be availed to fund any renovations and repairs for their existing abodes.  

Siddhartha Mohanty, MD and CEO, told that the lender expects a lesser variety of borrowers to choose to the restructuring of loans. The Reserve Bank of India (RBI) had earlier approved the resolution of personal and corporate loans with strict limitations. 

He said that the loans under moratorium remained at the same level during phase 1 at 25%. They assume loans under restructuring to be lesser than that and are still evaluating huge contours of coverage on the restructuring of personal loans. 

The asset quality of the lender progressed sequentially. Gross stage 3 loans stood at 2.83%, down 3 basis points (bps), in comparison to 2.86% in the preceding quarter.  Overall disbursements declined to Rs 3,560 crore in the quarter under review, against Rs 10,261 crore in the same sector last year. For the month of June, retail disbursements picked up to 62% of the corresponding figure of the preceding year. 

The total loan portfolio stood at Rs 2,09,817 crore, against Rs 1,97,768 crore, a Y-o-Y boom of 6%. The person loan portfolio was at Rs 1,95,176 crore, as compared with Rs 1,84,155 crore, showcasing a Y-o-Y rise of 6 %. Out of that, the home loan portfolio registered a growth of 6.4 %. The developer loan portfolio stood at Rs 14,641 crore as on June 30, 2020, in comparison with Rs 13,614 crore as on June 30, 2019. 

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