PNB HOUSING FINANCE 2023-24 Annual Report Analysis

Fri, 19 Jul

PNB HOUSING FINANCE has announced its results for the year ended March 2024. Let us have a look at the detailed performance review of the company during the year 2023-24.

PNB HOUSING FINANCE Income Statement Analysis

• Interest income during the year rose 8.0% on a year-on-year (YoY) basis.
• Interest expenses were up by 9.3% YoY during the same period.
• Operating expenses declined by 58.5% YoY during the year.
• The company's net interest income (NII) increased by 6.1% YoY during the fiscal. Consequently, net interest margins (NIM) witnessed a decline and stood at 4.1% in FY24 as against 4.3% in FY23.
• Other income declined by 83.1% YoY during the year.
• Net profit for the year increased by 44.2% YoY.
• Net profit margins during the year increased to 21.4% in FY24 from 16.0% in FY23.

PNB HOUSING FINANCE Income Statement – 2023-24

No. of Mths Year Ending		12 Mar-23*	12 Mar-24*	% Change
Interest Income	Rs m	65,273	70,501	8.0%
Other Income	Rs m	11,284	1,903	-83.1%
Interest Expense	Rs m	39,000	42,631	9.3%
Net Interest Income	Rs m	26,274	27,870	6.1%
Operating Expense	Rs m	23,435	9,722	-58.5%
Pre-provision Operating Profit	Rs m	14,124	20,051	42.0%
Provisions & Contingencies	Rs m	97	518	435.0%
Profit before tax	Rs m	13,609	19,539	43.6%
Tax	Rs m	3,149	4,459	41.6%
Profit after tax	Rs m	10,460	15,080	44.2%
Minority Interest	Rs m	0	0	0.0%
Net Interest Margin	%	4.3	4.1
Net profit margin	%	16.0	21.4

Don't Miss: Key Information for Long-term Investors

PNB HOUSING FINANCE Balance Sheet Analysis

• The company's deposits during FY24 stood at Rs 156.8 bn as compared to Rs 155.1 bn in FY23, thereby witnessing an increase of 1.1%.
• Advances for the year stood at Rs 641.1 bn as compared to Rs 578.4 bn during FY23, a rise of 10.8%.
• Cost of deposits for PNB HOUSING FINANCE fell 0.6% and stood at 8.4%, while yield on advances rose to 0.0%.
• The lender's investments rose to Rs 43.8 bn during the year from Rs 32.3 bn in FY23.
• Borrowing stood at Rs 82.6 bn, a growth of 29.3% as compared to previous year.
• Overall, the total assets and liabilities for FY24 stood at Rs 727.9 bn as against Rs 668.2 bn during FY23, thereby witnessing a rise of 8.9%.

PNB HOUSING FINANCE Balance Sheet – as on March 2024

No. of Mths Year Ending		12 Mar-23*	12 Mar-24*	% Change
Networth	Rs m	109,637	149,279	36.2%
Advances	Rs m	578,398	641,082	10.8%
Deposits	Rs m	155,133	156,775	1.1%
Yield on advances	%	0.0	0.0
Cost of Deposits	%	8.5	8.4
Investments	Rs m	32,256	43,849	35.9%
Borrowings	Rs m	63,876	82,604	29.3%
Total Assets	Rs m	668,248	727,948	8.9%

Current Valuations for PNB HOUSING FINANCE

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 58.1, an improvement from the EPS of Rs 61.9 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 785.0, stands at 11.4 times its trailing twelve months earnings.
• The price to adjusted book value (P/ABV) ratio at current price levels stands at 1.4 times, while the price to income ratio stands at 2.4 times.

Per Share Data/Valuations

No. of Mths Year Ending		12 Mar-23*	12 Mar-24*
Income per share (Unadj.)	Rs	386.6	271.4
Earnings per share (Unadj.)	Rs	61.9	58.1
Diluted earnings per share	Rs	40.3	58.1
Avg P/E ratio	Rs	7.8	11.4
Avg P/ABV ratio	Rs	1.5	1.4
Avg Market Cap	Rs	81,578	171,541
Dividends per share (Unadj.)	Rs	0.00	0.00

Ratio Analysis for PNB HOUSING FINANCE

• Efficiency Ratios

  Credit/Deposit Ratio: The company's credit/deposit ratio improved and stood at 408.9x during FY24, from 372.8x during FY23. The credit/deposit ratio tells us how much money a company has raised in the form of deposits and has deployed as loans.

  Debt to Equity Ratio: The company's debt to equity ratio decreased and stood at 1.60x during FY24, from 2.00x during FY23. The debt to equity ratio of a company tells us how much debt a company uses relative to its equity.

• Liquidity Ratios

  Capital Adequacy Ratio (CAR): PNB HOUSING FINANCE's capital adequacy ratio (CAR) was at 29.3% as on 31 March 2024 as compared to 24.4% a year ago. This ratio helps measure the financial strength of the company or any finance company to meet their obligations using their assets and capital.

  A company that has a good CAR has enough capital to absorb potential losses. Thus, it has less risk of becoming insolvent and losing depositor's money.

  Provision Coverage Ratio (PCR): Apart from CAR, you also need to take a look at the company's PCR and LCR ratios. Provisioning coverage ratio (PCR) is the percentage of funds that a company sets aside for covering losses due to bad debts.

  So a high PCR ratio means asset quality issues are under control and the company is not vulnerable.

  Liquidity Coverage Ratio (LCR): The LCR is designed to ensure that companies hold a sufficient reserve of high-quality liquid assets to allow them to survive a period of significant liquidity stress lasting 30 calendar days.

• Profitability Ratios

  Return on Equity (ROE): The return on equity (ROE) ratio for the company improved and stood at 10.1% during FY24, from 9.5% during FY23. The ROE measures the ability of a firm to generate profits from its shareholders capital in the company.

  Return on Assets (ROA): The return on asset (ROA) ratio of the company improved and stood at 2.07% during FY24, from 1.57% during FY23. The ROA measures how efficiently the company uses its assets to generate earnings.

  Return on Capital Employed (ROCE): The ROCE for the company improved and stood at 9.24% during FY24, from 8.25% during FY23. The ROCE measures the ability of a company to generate profits from its total capital (shareholder capital plus debt capital) employed in the company.

• NPA Ratios

  Gross NPA Ratio: The gross NPA ratio is the ratio of a company's gross NPAs to gross advances. PNB HOUSING FINANCE's gross NPA ratio stood at 1.5% as of 31 March 2024 compared to 3.8% in the same period a year ago.

  A high gross NPA ratio is a bad thing as it indicates how much of a company's loans are in danger of not being repaid.

  Net NPA Ratio: In simple language, net NPAs are simply the total non-performing assets minus the provision left aside. It gives you the exact value of NPAs after the company has made provisions.

  The net NPA ratio of PNB HOUSING FINANCE was 1.0% in financial year 2024. This compared with 2.8% a year ago.

Key Ratio Analysis

No. of Mths Year Ending		12 Mar-23*	12 Mar-24*
Credit/Deposit Ratio	x	372.8	408.9
Debt to Equity Ratio	x	2.0	1.6
Loans / Deposits	x	0.0	0.0
Capital Adequacy Ratio	%	24.4	29.3
Return on Equity	%	9.5	10.1
Return on Assets	%	1.6	2.1
Return on Capital Employed	%	8.3	9.2
% of Gross NPAs	%	3.8	1.5
% of Net NPAs	%	2.8	1.0
Yield on Advances	x	0.0	0.0
Yield on Investments	x	0.0	0.0

To see how PNB HOUSING FINANCE has performed over the last 5 years, please visit here.

PNB HOUSING FINANCE Share Price Performance

Over the last one year, PNB HOUSING FINANCE share price has moved up from Rs 640.5 to Rs 785.0, registering a gain of Rs 144.5 or around 22.6%.

Overall, the S&P BSE SENSEX is up 23.1% over the year.

(To know more, you can check out historical annual results for PNB HOUSING FINANCE here and quarterly results for PNB HOUSING FINANCE here)