Bernstein holds a positive outlook on India’s housing finance sector, citing structural growth and resilience. It initiated ‘Buy’ ratings on Home First, Aptus, and Aadhar Housing, highlighting scalability, rate resilience, and strong AUM growth potential.
India’s housing finance sector is experiencing robust growth, with the total outstanding housing loans reaching ₹33 trillion as of March 2024. The market is projected to double to ₹81 trillion by 2030, driven by rising urbanization, government incentives, and a 13% compound annual growth rate over the past six years.
The brokerage believes the housing finance sector has structural growth opportunities and business model resilience. So, here are a few companies in which Bernstein initiated coverage.
1. Home First Finance Company India Ltd
With a market capitalization of Rs 14,356.00 crore, the shares were trading at Rs 1,390.50 per share, increasing around 1.95 percent as compared to the previous closing price.
Bernstein, one of the well-known brokerages globally, gave a ‘Buy’ call on this stock with a target price of Rs 1,650 apiece, indicating a potential upside of 19 percent from Thursday’s price of Rs 1,390 per share.
The brokerage emphasized the company’s consistent success in replicating its operating model across various states. Its relatively smaller scale enables quicker expansion, higher productivity, and operational agility, offering it a competitive edge in maintaining profitability compared to larger peers in the industry.
2. Aptus Value Housing Finance India Ltd
With a market capitalization of Rs 17,212 crore, the shares were trading at Rs 344 per share, increasing around 1.10 percent as compared to the previous closing price.
Bernstein, one of the well-known brokerages globally, gave a ‘Buy’ call on this stock with a target price of Rs 400 apiece, indicating a potential upside of 16 percent from Thursday’s price of Rs 344 per share.
Bernstein highlighted that the company’s strong position in fixed-rate loans and focus on small business lending make it well-suited for a declining interest rate environment. Additionally, the firm sees the company’s current valuation levels as attractive and justified.
3. Aadhar Housing Finance Ltd
With a market capitalization of Rs 19,380 crore, the shares were trading at Rs 449 per share, decreasing around 0.14 percent as compared to the previous closing price.
Bernstein, one of the well-known brokerages globally, gave a ‘Buy’ call on this stock with a target price of Rs 550 apiece, indicating a potential upside of 22 percent from Thursday’s price of Rs 449 per share.
Bernstein anticipates the company, being the largest and most geographically diversified among its peers, to sustain a strong growth momentum. It projects the firm’s assets under management (AUM) to grow at a steady compound annual growth rate (CAGR) of 20%.
Written by Abhishek Singh
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