Buy Repco Home Finance Limited for Target Rs.550 - Yes Securities Ltd
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Strong performance continues
Repco delivered 5-6% NII/PPOP and 10% PAT beat on our expectations. While disbursements/loan growth was in-line, the significant performance beat was driven by material margin expansion and substantial improvement in asset quality that drove negligible credit cost. RoA/RoE stood at 3.1%/16%, a multi-quarter high.
Shifting of growth gear from H2 FY24 would be key monitorable
Disbursements stood at Rs8bn (v/s est. Rs8.3bn), marking an acceleration in business activity from Q1 FY24. AUM grew by 2.1% qoq/7.1% yoy, as portfolio reduction was higher than the preceding quarter at annualized 17% (15% in Q1) mainly on account of much higher NPL resolution/recovery. There was no increase in BT Out and it continues to be modest at
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SEBI Registration number is INZ000185632
