Indiabulls Housing Finance
BSE SENSEX
32,507
Bloomberg
Equity Shares (m)
M.Cap.(INRb)/(USDb)
52-Week Range (INR)
1, 6, 12 Rel. Per (%)
Avg Val, INRm
Free float (%)
S&P CNX
10,185
IHFL IN
421.3
486.6/7.6
1375 / 616
6/24/37
1872
76.4
23 October 2017
2QFY18 Results Update | Sector: Financials
CMP: INR1,343
TP: INR1,550 (+15%)
Buy
Strong growth, stable performance overall
Indiabulls Housing Finance's (IHFL) PAT grew 26% YoY to INR8.6b (4% above
our estimate). Core operating performance was robust, with strong AUM
growth (+33% YoY) and stable spreads. However, other income (income from
the liquid investment book) remains subdued due to lower incremental yields.
Note that IHFL had generated a good spread on its investment book above cost
of funds in FY16 and FY17 - that is beginning to vanish now.
AUM growth was in line with trend at 33% YoY to reach INR1t. This was driven
by 36% YoY growth in disbursements to INR95b. Management is bullish on
pick-up in supply in the affordable housing space.
Despite competitive pressures, IHFL managed to hold spreads steady at 3.25%.
Management continues to guide for incremental spreads in the range of 2.75-
3% and book spreads of 3-3.25%. Incremental cost of funds is around 7.3-7.5%.
The share of home loans in the overall book inched up 100bp to 58%. With the
share continuously inching up (to the target of 66% by FY20), we believe spread
pressure will continue.
Valuation and view:
IHFL's transformation from a diversified lender to a
focused mortgage player has yielded returns, with RoE/RoA improving from
3%/0.8% in FY09 to 26%/3.4% in FY17. Focus on core mortgage loans and
market share gains should drive AUM growth of 25%+ over the next three
years. IHFL is among the lowest-levered HFCs. Asset quality trend is likely to
remain stable. We keep our EPS estimates largely unchanged. Maintain
Buy
with a TP of INR1,550 (4x Sep19E P/B).
Financials & Valuations (INR b)
Y/E March
2017 2018E 2019E
Net Fin inc
35.3 52.9 65.9
PPP
45.5 55.9 71.0
EPS (INR)
68.6 83.6 105.1
EPS Gr. (%)
23.2 21.9 25.8
BV/Sh. (INR)
286
321
364
RoA on AUM (%)
3.1
2.9
2.8
RoE (%)
25.5 27.6 30.7
Payout (%)
39.3 50.0 50.0
Valuations
P/E (x)
19.6 16.1 12.8
P/BV (x)
4.7
4.2
3.7
P/ABV (x)
4.7
4.2
3.7
Div. Yield (%)
2.0
3.1
3.9
Research Analyst: Alpesh Mehta
(Alpesh.Mehta@MotilalOswal.com); +91 22 3982 5415
| Piran Engineer
(Piran.Engineer@MotilalOswal.com); +91 22 3980 4393
Nitin Aggarwal
(Nitin.Aggarwal@MotilalOswal.com); +91 22 3982 5540
| Anirvan Sarkar
(Anirvan.Sarkar@MotilalOswal.com); +91 22 3982 5505
Investors are advised to refer through important disclosures made at the last page of the Research Report.
Motilal Oswal research is available on www.motilaloswal.com/Institutional-Equities, Bloomberg, Thomson Reuters, Factset and S&P Capital.

Indiabulls Housing Finance
Exhibit 1: Quarterly performance v/s expectations and deviations for the same
Particulars
Income from operations
Other Income
Total income
Interest expenses
Net Income
Operating Expenses
Profit before Tax
Tax Provisions
Net Profit
Minority Int
Net Profit (after minority interest)
Int Exp/ operating inc (%)
Other Income / Total Income (%)
Tax Rate (%)
E: MOSt Estimates
2QFY18A
30,670
2,755
33,425
18,355
15,070
3,935
11,135
2,615
8,520
91
8,611
59.8
8.2
23.5
2QFY18E
30,151
3,200
33,351
18,342
15,009
3,843
11,166
2,903
8,263
40
8,303
60.8
9.6
26.0
Var. (%)
2
-14
0
0
0
2
0
-10
3
128
4
Comments
In-line
In-line
In-line
Lower-than-estimated
In-line
Marginally above estimate
AUM growth was robust at
33% YoY
Continued robust AUM growth at 33% YoY
Disbursements were up 36% YoY to INR95b, manifesting AUM growth of 33%
YoY to INR1t.
Share of home loans increased 100bp to 58%.
Management has guided for
incremental spreads of 275-
300bp
Reported spreads stable
Calculated yield on AUM declined 170bp YoY and 10bp QoQ to 13.2%, driven by
yields pressure as well as migration to retail home loans.
Yet, reported spreads remained largely stable at 3.25%.
Incremental cost of funds declined 53bp QoQ to 7.3%.
Incremental yields for different segments in 1QFY18 were: Home Loan – 9.6%;
LAP – 13%; Construction finance – 16%
Asset quality stable
Asset quality was stable, with GNPL ratio at 0.78% v/s 0.83% in 2QFY17.
Provisions made during the quarter amounted to INR1.87b, as against INR1.45b
in 2QFY17.
Others
In Oct 2017, Oak North Bank raised an investment of USD203m at a valuation of
USD1.27b (280% more than at the time of IHFL’s investment in Oak North Bank).
IHFL seems adequately equipped to gain market share from PSU banks, given its
low cost structure. We think IHFL will gain meaningfully from the government’s
impetus to affordable housing.
We believe the focus on mortgage and market share gains will drive AUM
growth of 25%+ for the next three years. As individual home loans have lower
risk weight than corporate loans, capital consumption will be lower with gradual
shift toward individual home loans. At the same time, increased sell-downs will
also help improve return ratios.
IHFL has consistently outperformed peers on key parameters. Average three-
year RoE at 26% is the best among the peer group. The company offers superior
return ratios with ~3% dividend yield.
Valuation and view
23 October 2017
2

Indiabulls Housing Finance
We keep our estimates largely unchanged. We use RI model with Rf of 7%, CoE
of 14% and terminal growth rate of 5%. Maintain
Buy
with a target price of
INR1,550 (4x Sep 2019E P/B).
Exhibit 2: We marginally cut our estimates
INR B
Net Financing income
Other Income
Net Income
Opex
PBT
Tax
PAT
AUM
Loans
Borrowings
Credit Cost
RoA on AUM
FY18
51.9
13.0
64.9
8.7
47.8
12.4
35.5
1,194
1,075
1,101
0.80
2.9
Old Est
FY19
64.0
16.9
81.0
10.1
60.0
15.6
44.5
1,536
1,382
1,423
0.80
2.9
FY20
80.6
22.0
102.7
11.7
77.1
20.0
57.2
1,938
1,744
1,805
0.80
2.9
FY18
52.9
11.8
64.7
8.9
47.4
12.1
35.4
1,194
1,075
1,128
0.80
2.9
New Est
FY19
65.9
15.4
81.2
10.3
60.1
15.6
44.6
1,536
1,382
1,465
0.80
2.8
FY20
80.7
20.0
100.7
11.9
74.9
19.5
55.6
1,938
1,744
1,866
0.80
2.8
FY18
2.0
-9.3
-0.3
1.8
-0.7
-2.6
-0.1
0.0
0.0
2.4
% Change
FY19
2.9
-9.3
0.3
1.7
0.2
0.2
0.2
0.0
0.0
2.9
FY20
0.1
-9.3
-1.9
1.7
-2.8
-2.8
-2.8
0.0
0.0
3.4
Source: Company, MOSL
Conference call highlights
Business updates
Management has guided for 30% AUM growth for FY18. AUM is likely to reach
~INR2t by FY20.
Reiterated guidance of 66% share of retail home loans by FY20 (currently 58%).
Incremental spreads = 2.99% (compared to guided range of 2.75-3%).
Presently, 70% HLs are sourced from top-20 cities. In next two years, half of the
home loan sourcing will come from the non-Top 10 cities.
Management targets INR75b worth of insurance premiums sold in FY18. Hence,
fee income growth to be more than loan book growth.
Disbursements in 2QFY18 – Total: INR95b; HL: INR58b, LAP: INR18b, Corp:
INR19b.
According to management, IHFL would be raising bonds at 10-50bp higher than
AAA rated entities like HDFC and LICHF. About 12 months back, it was 40-110bp
higher.
INR60b worth of liabilities will come up for refinancing in 2HFY18. Incremental
cost of funds likely to be around 7.3-7.5% in 2HFY18.
Fee income in 2QFY18 – INR1.85b.
HL book breakup – New construction – 70-75%; Self-construction – 10%; Resale
– 5%; Balance transfer 5%.
On-book yields: HL – 9.63%, LAP – 11%, CF – 16%, LRD – 11%.
Asset Quality
Provisions made during the quarter – INR1.87b (INR1.45b YoY).
Others
LAP constitutes 21% of total AUM.
Management expects the spread of home loans above GSec yields for the
industry to be in the range of 150-200bp.
3
23 October 2017

Indiabulls Housing Finance
Growth in mass housing for the industry should be 35-40% going forward,
according to management.
Management plans to raise USD750m in 2HFY18 via masala bonds/ECB route.
Delhi NCR contributes to 25% of HL book.
The company has changed its auditor from Deloitte to Ernst and Young.
Issued INR10b of Tier II Bonds in 2QFY18. Guidance to keep CAR above 20%.
In Oct 2017, Oak North Bank raised an investment of USD203m at a valuation of
USD1.27b (280% more than at the time of IHFL’s investment in Oak North Bank).
Exhibit 3: Quarterly Snapshot
FY16
1Q
Profit and Loss (INR m)
Income from operations
Interest Expenses
Net Interest Income
Other Income
Total Income
Operating Expenses
Employee
Others
PBT
Taxes
PAT
Minority Interest
PAT Post Minority Interest
Asset Quality
GNPA (INR m)
NNPA (INR m)
Gross NPA (%)
Net NPA (%)
Provisions on AUM (%)
Margins (%) - (calculated)
Yield on loans
Cost of funds
Spreads
NIMs
Ratios (%)
Cost to Income
Tax Rate
RoE (Calc.)
RoA (Calc.)
Business Details
Disbursements-Quarterly (INR b)
AUM (INR b)
Borrowings (INR b)
Total AUM Mix (%)
Mortgages
Corporate
Liability Mix (%)
Bank Loans
CP
NCD
ECB
Other Details
Dividend (INR/sh)
18,290
11,390
6,900
1,960
8,859
1,937
914
1,023
6,922
1,810
5,113
0
5,113
4,071
1,935
0.85
0.36
0.49
13.3
9.3
4.0
5.2
21.9
26.1
30.7
3.5
45
540
509
76
22
55
7
35
3
9
2Q
19,850
12,450
7,400
2,607
10,007
2,594
1,059
1,535
7,413
1,858
5,555
0
5,555
4,309
2,028
0.84
0.35
0.49
13.3
9.6
3.7
5.2
25.9
25.1
26.1
3.5
62
582
528
76
23
47
6
33
2
9
3Q
20,751
12,258
8,493
2,326
10,820
2,765
1,012
1,753
8,055
2,010
6,045
-21
6,024
4,553
2,169
0.83
0.35
0.48
13.0
9.0
4.0
5.2
25.6
25.0
23.1
3.5
65
623
636
76
23
49
6
31
2
9
4Q
24,009
13,616
10,392
2,463
12,855
3,957
1,147
2,811
8,898
2,083
6,815
-60
6,754
5,116
2,393
0.84
0.35
0.49
13.6
9.3
4.3
5.6
30.8
23.4
25.5
3.7
91
687
689
77
22
49
0
38
2
9
1Q
23,720
14,109
9,611
2,255
11,866
3,116
1,185
1,931
8,750
2,401
6,349
-49
6,301
5,430
2,545
0.84
0.36
0.48
12.8
8.9
4.0
5.0
26.3
27.4
22.9
3.2
53
710
745
77
23
47
0
40
2
9
2Q
25,098
16,279
8,819
3,651
12,470
3,258
1,358
1,900
9,212
2,352
6,861
-18
6,843
5,686
2,548
0.83
0.34
0.49
12.9
9.3
3.6
4.8
26.1
25.5
24.0
3.2
67
753
832
78
22
39
0
49
2
9
FY17
3Q
25,859
16,329
9,530
4,186
13,716
3,658
1,318
2,340
10,058
2,555
7,502
13
7,515
6,557
2,917
0.85
0.36
0.49
12.6
8.3
4.3
5.0
26.7
25.4
25.8
3.1
91
814
919
79
21
37
0
50
3
9
4Q
29,314
17,391
11,923
2,935
14,858
5,160
1,136
4,024
9,698
1,325
8,373
32
8,405
7,062
3,271
0.85
0.36
0.49
13.0
8.3
4.7
5.0
34.7
13.7
28.1
3.3
132
913
940
78
22
37
0
51
3
9
1Q
29,560
17,722
11,838
2,690
14,528
3,928
1,332
2,596
10,600
2,764
7,836
46
7,882
6,775
2,914
0.80
0.31
0.49
12.2
8.2
4.0
4.7
27.0
26.1
26.0
3.0
70
945
978
78
22
35
0
52
3
9
FY18
2Q
30,670
18,355
12,315
2,755
15,070
3,935
1,531
2,404
11,135
2,615
8,520
91
8,611
6,319
3,093
0.78
0.31
0.47
12.1
7.9
4.2
4.7
26.1
23.5
28.0
3.1
90
1,003
1,071
78
22
33
0
54
3
9
Source: Company, MOSL
29
6
10
34
33
29
Variation (%)
QoQ
YoY
4
4
4
2
4
0
15
(7)
5
(5)
9
9
(7)
6
22
13
40
(25)
21
21
13
27
21
11
24
26
11
21
23 October 2017
4

Indiabulls Housing Finance
Story in charts
Exhibit 4: Disb. growth of 34% YoY
Disbursement (INR b)
91
48
54
64
45
62
65
53
67
91
70
132
95
18
23
27
29
Exhibit 5: Continued robust AUM growth at +33%
AUM (INR b)
29
30
32
31
AUM Gr. (%)
29
31
33
33
33
Source: Company, MOSL
Source: Company, MOSL
Exhibit 6: AUM mix has been stable
Others
3
21
3
21
2
22
2
22
1
23
CV
1
23
Corporate
1
22
0
23
0
22
Mortgages
0
21
0
22
0
22
0
22
Exhibit 7: Management targets 60% share of NCD by FY20
Sell Down (%)
32
8
28 28
7 7
ECB(%)
NCD (%)
CP (%)
Bank Loans (%)
76
76
76
76
76
76
77
77
78
79
78
78
78
33 31 38 40
49 50 51 52 54
6 0 0
6
0 0 0 0 0
60 54 53 59 55
47 49 49 47 39 37 37
35 33
7
7
31 35
Source: Company, MOSL
Source: Company, MOSL
Exhibit 8: Asset quality remains healthy
GNPA (%)
NNPA (%)
Exhibit 9: Net gearing (x) among lowest compared to peers
5.7
6.1 5.9 6.3
3.9
4.7 4.6 4.8
4.3
5.2
6.2
5.7 5.9
0.9 0.9 0.8 0.8 0.9 0.9 0.9 0.9 0.8 0.8 0.8 0.8 0.8 0.9 0.9 0.8
0.8
0.4 0.5
0.4 0.4 0.3 0.3 0.4 0.4 0.4 0.4 0.4 0.4 0.3 0.4 0.4 0.3 0.3
Source: Company, MOSL
Source: Company, MOSL
23 October 2017
5

Indiabulls Housing Finance
Exhibit 10: Financials: Valuation metrics
66
Rating
ICICIBC*
HDFCB
AXSB
KMB*
YES
IIB
IDFC Bk
FB
DCBB
JKBK
SIB
Equitas
RBL
Private Aggregate
SBIN (cons)*
PNB
BOI
BOB
CBK
UNBK
OBC
INBK
Public Aggregate
Banks Aggregate
HDFC*
LICHF
IHFL
PNBHF
GRHF
REPCO
DEWH
Housing Finance
SHTF
MMFS
BAF
CIFC
SCUF
LTFH
MUTH
CAFL
SKSM
Asset Finance
FY19E
Buy
Buy
Neutral
Buy
Buy
Buy
Neutral
Buy
Neutral
Neutral
Buy
Buy
Buy
Buy
Buy
Neutral
Buy
Neutral
Neutral
Neutral
Buy
CMP
(INR)
263
1,863
450
1,062
354
1,696
56
125
182
73
32
152
528
246
131
135
138
306
127
114
264
Mcap
(USDb)
25.4
73.0
17.0
30.5
12.6
15.6
2.9
3.3
0.8
0.6
0.7
0.8
3.0
32.2
4.2
2.2
4.8
2.5
1.3
0.6
1.9
FY18E
14.5
68.2
18.1
32.4
18.5
60.9
2.8
5.5
8.5
3.9
1.9
1.7
17.2
14.6
5.8
-11.2
9.5
30.1
9.0
17.1
34.4
FY19E
16.6
82.6
29.9
41.0
22.9
78.6
3.2
6.6
10.5
8.3
3.8
6.1
22.5
26.8
11.0
6.6
20.8
47.0
19.1
21.4
38.3
FY18E
12.0
27.3
24.8
32.7
19.2
27.8
20.3
22.5
21.4
18.9
17.2
89.3
30.7
14.7
22.4
-12.0
14.5
10.2
14.0
6.7
7.7
FY19E
9.6
22.6
15.0
25.9
15.5
21.6
17.4
18.7
17.4
8.9
8.5
25.1
23.5
7.8
11.9
20.4
6.6
6.5
6.6
5.3
6.9
FY18E
1.19
4.80
1.83
4.57
3.27
4.39
1.24
1.96
2.18
0.65
1.18
2.25
3.31
0.94
0.71
0.62
0.87
0.61
0.42
0.30
0.81
FY19E
1.01
4.13
1.66
3.90
2.80
3.74
1.18
1.80
1.94
0.62
1.06
2.08
2.96
0.85
0.68
0.62
0.79
0.57
0.40
0.28
0.74
FY18E
1.14
1.84
0.67
1.84
1.78
1.82
0.74
0.81
0.98
0.23
0.42
0.58
1.28
0.36
0.17
-0.19
0.31
0.29
0.14
0.22
0.73
FY19E
1.15
1.85
0.97
1.99
1.80
1.89
0.71
0.86
1.00
0.44
0.75
1.65
1.28
0.60
0.30
0.10
0.61
0.41
0.27
0.26
0.72
FY18E
8.6
18.8
7.6
15.0
18.3
16.9
6.3
9.6
11.5
3.5
6.7
2.5
13.0
7.0
3.2
-5.2
6.1
6.2
3.0
4.6
10.9
FY19E
9.3
19.7
11.6
16.3
19.5
19.0
6.9
10.0
11.8
7.2
12.6
8.6
13.3
11.4
5.9
3.0
12.4
9.1
6.1
5.4
11.2
Buy
Neutral
Buy
Buy
Neutral
Buy
Buy
Buy
Buy
Buy
Buy
Buy
Buy
Buy
Buy
Neutral
1,721
652
1,343
1,460
503
652
583
1,112
423
1,834
1,140
2,137
209
498
746
1,014
42.3
5.1
8.8
3.8
2.9
0.6
2.9
3.8
3.7
16.3
2.7
2.1
5.7
3.1
1.1
2.2
39.9
41.6
84.2
48.1
9.9
33.7
37.6
80.0
13.9
45.7
56.0
118.3
6.8
38.7
32.8
29.9
45.4
48.9
105.6
65.1
12.0
38.4
46.0
102.4
17.8
63.7
68.1
155.3
10.1
44.4
42.4
54.9
24.6
15.7
16.0
30.3
51.0
19.3
15.5
13.9
30.5
40.1
20.4
18.1
30.6
12.9
22.7
33.9
19.2
13.3
12.7
22.4
41.8
17.0
12.7
10.9
23.8
28.8
16.7
13.8
20.7
11.2
17.6
18.4
4.31
2.66
4.16
3.97
15.20
3.07
2.07
1.99
3.52
6.44
3.51
2.49
4.14
2.59
2.83
4.64
3.04
2.29
3.66
3.48
12.47
2.63
1.82
1.73
3.24
5.40
2.97
2.16
3.54
2.20
2.47
3.73
1.79
1.44
3.20
1.52
2.40
2.18
1.23
2.67
1.73
3.45
2.85
3.34
1.61
4.82
1.74
3.24
1.81
1.51
3.16
1.48
2.40
2.14
1.28
3.06
1.90
3.55
2.94
3.84
2.09
4.94
1.80
4.03
18.6
18.2
27.6
13.8
32.8
17.1
14.1
15.0
12.0
20.2
18.6
14.6
14.7
21.8
13.2
15.1
17.8
18.5
30.6
16.6
32.8
16.7
15.3
16.9
14.2
20.4
19.2
16.8
18.5
21.2
15.0
22.4
*Multiples adj. for value of key ventures/Investments; For ICICI Bank and HDFC Ltd BV is adjusted for investments in subsidiaries
23 October 2017
6

Indiabulls Housing Finance
Financials and valuations
Income Statement
Y/E March
Financing Income
Financing Charges
Net Financing income
Change (%)
Non interest Income
Net Income
Change (%)
Employee Cost
Other Operating Exp.
Operating profits
Change (%)
Total Provisions
% of operating profit
PBT
Tax
Tax Rate (%)
PAT
Change (%)
Minority Interest
PAT
Change (%)
Dividend (Including tax)
Balance Sheet
Y/E March
Equity Share Capital
Reserves & Surplus
Net Worth
Equity Net worth
Minority Interest
Borrowings
Change (%)
Deferred Tax Liability
Total Liabilities
Cash and bank balance
Investments
Change (%)
Loans
Change (%)
Net Current Assets
Net Fixed Assets
Total Assets
2013
42,634
25,991
16,643
27.7
5,145
21,788
17.0
2,245
1,761
17,782
19.1
1,231
6.9
16,551
3,891
23.5
12,660
34.4
76
12,584
34.8
7,277
2014
51,865
32,824
19,041
14.4
7,181
26,222
20.4
2,637
1,470
22,115
24.4
2,297
10.4
19,818
4,133
20.9
15,685
23.9
44
15,642
24.3
11,298
2015
61,210
39,442
21,768
14.3
11,494
33,262
26.8
3,249
2,285
27,728
25.4
3,003
10.8
24,725
5,713
23.1
19,012
21.2
1
19,011
21.5
10,531
2016
78,418
49,714
28,704
31.9
13,837
42,541
27.9
4,131
2,053
36,357
31.1
5,069
13.9
31,289
7,760
24.8
23,529
23.8
81
23,448
23.3
21,459
2017
99,377
64,108
35,270
22.9
17,640
52,910
24.4
4,997
2,366
45,547
25.3
7,829
17.2
37,718
8,633
22.9
29,086
23.6
22
29,064
24.0
13,746
2018E
128,693
75,783
52,910
50.0
11,819
64,729
22.3
5,996
2,882
55,851
22.6
8,428
15.1
47,423
12,093
25.5
35,330
21.5
-100
35,430
21.9
20,727
2019E
163,773
97,893
65,880
24.5
15,365
81,245
25.5
6,895
3,378
70,971
27.1
10,918
15.4
60,053
15,614
26.0
44,439
25.8
-120
44,559
25.8
26,067
(INR Million)
2020E
206,494
125,761
80,734
22.5
19,974
100,708
24.0
7,930
3,962
88,816
25.1
13,895
15.6
74,921
19,479
26.0
55,442
24.8
-144
55,586
24.7
32,518
2013
625
51,061
51,686
51,686
1,449
312,858
23.7
-1,641
364,351
48,882
23,079
28.4
307,824
20.9
-15,889
456
364,351
2014
668
56,387
57,055
57,055
19
355,395
13.6
-1,848
410,622
44,190
29,470
27.7
354,446
15.1
-18,639
469
410,622
2015
711
65,606
66,317
66,317
20
474,874
33.6
-26
541,186
34,903
61,638
109.2
460,396
29.9
-16,978
541
541,186
2016
843
106,097
106,939
106,939
0
610,853
28.6
760
718,552
29,017
106,928
73.5
608,643
32.2
-27,393
686
718,552
2017
848
120,373
121,221
121,221
0
853,011
39.6
1,103
975,335
56,825
136,166
27.3
826,139
35.7
-45,377
903
975,335
2018E
848
135,077
135,924
135,924
0
1,128,253
32.3
1,103
1,265,280
32,780
211,058
55.0
1,074,526
30.1
-54,452
690
1,265,280
2019E
848
153,569
154,416
154,416
0
1,464,939
29.8
1,103
1,620,458
48,564
253,269
20.0
1,382,018
28.6
-65,343
1,272
1,620,458
2020E
848
176,637
177,484
177,484
0
1,866,466
27.4
1,103
2,045,053
73,016
303,923
20.0
1,744,360
26.2
-78,411
1,487
2,045,053
23 October 2017
7

Indiabulls Housing Finance
Financials and valuations
AUM Mix
Assets Under Management
Change (%)
On Books
% of AUM
Off books
% of AUM
E: MOSL Estimates
Ratios
Y/E March
Spreads Analysis (%)
Avg. Yield - on Fin. Portfolio
Avg Cost of funds
Interest Spread on on books
Net Interest Margin on AUM
Profitability Ratios (%)
RoE
RoA
RoA (on AUM)
Int. Expended/Int.Earned
Cost/Income Ratio
Empl. Cost/Op. Exps.
Asset quality
GNPA (%)
NNPA (%)
Valuations
Book Value (INR)
BV Growth (%)
Price-BV (x)
Adjusted BV (INR)
Price-ABV (x)
EPS (INR)
EPS Growth (%)
Price-Earnings (x)
DPS (INR)
Dividend Payout (%)
Dividend Yield (%)
E: MOSL Estimates
344,250
25.1
307,824
89.4
36,426
10.6
411,690
19.6
354,446
86.1
57,244
13.9
522,350
26.9
460,396
88.1
61,954
11.9
686,830
31.5
608,643
88.6
78,187
11.4
913,010
32.9
826,139
90.5
86,871
9.5
1,193,918
30.8
1,074,526
90.0
119,392
10.0
1,535,575
28.6
1,382,018
90.0
153,558
10.0
(%)
1,938,178
26.2
1,744,360
90.0
193,818
10.0
2013
13.5
10.1
3.4
5.4
2014
13.1
10.1
3.0
5.0
2015
12.7
9.7
3.0
4.7
2016
12.6
9.2
3.4
4.7
2017
12.2
8.8
3.4
4.4
2018E
12.0
7.7
4.4
5.0
2019E
11.8
7.6
4.3
4.8
2020E
11.7
7.6
4.2
4.6
25.0
3.8
3.5
61.0
18.0
56.1
27.0
4.0
3.6
63.3
17.1
64.2
30.8
4.0
3.6
64.4
16.6
58.7
27.1
3.7
3.3
63.4
14.5
66.8
25.5
3.4
3.1
64.5
13.9
67.9
27.6
3.2
2.9
58.9
13.7
67.5
30.7
3.1
2.8
59.8
12.6
67.1
33.5
3.0
2.8
60.9
11.8
66.7
0.79
0.33
2013
165.4
5.1
165.4
40.3
25.8
20.0
49.6
0.83
0.36
2014
170.8
3.3
170.8
46.8
16.3
29.0
61.7
0.85
0.36
2015
186.5
9.2
186.5
53.5
14.2
35
47.9
0.84
0.35
2016
253.8
36.1
253.8
55.7
4.1
45.0
76.0
0.80
0.40
2017
286.0
12.7
4.7
286.0
4.7
68.6
23.2
19.6
27.0
39.3
2.0
0.80
0.40
2018E
320.7
12.1
4.2
320.7
4.2
83.6
21.9
16.1
41.8
50.0
3.1
0.80
0.40
2019E
364.3
13.6
3.7
364.3
3.7
105.1
25.8
12.8
52.6
50.0
3.9
0.80
0.40
2020E
418.7
14.9
3.2
418.7
3.2
131.1
24.7
10.2
65.6
50.0
4.9
23 October 2017
8

Indiabulls Housing Finance
Corporate profile
Company description
Indiabulls Housing Finance (IHFL) is the fourth largest
housing finance company in India with AUM of over
INR900b as of FY17. It was established as a wholly-owned
subsidiary of Indiabulls Financial Services (IBFSL). In early
2013, keeping with IHFL’s long-term commitment to the
housing finance business, the company was reversed-
merged into its housing finance subsidiary IHFL. IHFL
offers home loans to target client base of middle and
upper-middle income individuals and small and medium-
sized enterprises, or SMEs.
Source: MOSL/Bloomberg
Exhibit 1: Sensex rebased
Exhibit 2: Shareholding pattern (%)
Jun-17
Promoter
DII
FII
Others
23.6
6.0
61.7
8.7
Mar-17
23.6
3.7
63.5
9.2
Jun-16
24.2
2.6
59.4
13.8
Source: Capitaline
Exhibit 3: Top holders
Holder Name
EUROPACIFIC GROWTH FUND
MERRILL LYNCH MARKETS SINGAPORE PTE.
LTD
LIFE INSURANCE CORPORATION OF INDIA
TUPELO CONSULTANCY LLP
SMALLCAP WORLD FUND INC
% Holding
6.2
3.1
2.8
2.2
1.7
Source: Capitaline
Note: FII Includes depository receipts
Exhibit 4: Top management
Name
Sameer Gehlaut
Gagan Banga
Ashwini Kumar
Mukesh Garg
Pinank Shah
Ramnath Shenoy
Designation
Chairman
Vice Chairman and MD
Deputy Managing Director
Chief Financial Officer
Head Treasury
Executive Vice President, IR
Exhibit 5: Directors
Name
Sameer Gehlaut
Gagan Banga
Rajiv Rattan
Saurabh Kumar Mittal
Karan Singh Khera*
Ram Kumar Sheokand*
Prem Prakash Mirdha*
Name
Shamsher Singh Ahlawat*
Aisharya Katoch
Joginder Singh Kataria
Ajit Kumar Mittal
Ashwini Omprakash Kumar
Kamalesh Shailesh Chandra
Chakrabarty*
Source: Capitaline
*Independent
Exhibit 6: Auditors
Name
N D Kapur & Co
Jatin Gupta & Associates
Ernst & Young
Internal
Secretarial Audit
Statutory
Type
Exhibit 7: MOSL forecast v/s consensus
EPS
(INR)
FY18
FY19
FY20
MOSL
forecast
83.6
105.1
131.1
Consensus
forecast
84.8
104.1
132.7
Variation (%)
-1.4
0.9
-1.2
Source: Bloomberg
Source: Capitaline
23 October 2017
9

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Indiabulls Housing Finance
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Analyst ownership of the stock
Indiabulls Housing Finance
No
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Centre, 2nd Floor, Palm Court Complex, New Link Road, Malad (West), Mumbai- 400 064. Tel No: 022 3080 1000. Compliance Officer: Neeraj Agarwal, Email Id:
na@motilaloswal.com,
Contact No.:022-30801085.
Registration details of group entities.: MOSL: NSE (Cash): INB231041238; NSE (F&O): INF231041238; NSE (CD): INE231041238; BSE (Cash): INB011041257; BSE(F&O): INF011041257; BSE(CD); MSE(Cash): INB261041231;
MSE(F&O): INF261041231; MSE(CD): INE261041231; CDSL: IN-DP-16-2015; NSDL: IN-DP-NSDL-152-2000; Research Analyst: INH000000412. AMFI: ARN 17397. Investment Adviser: INA000007100. Motilal Oswal Asset
Management Company Ltd. (MOAMC): PMS (Registration No.: INP000000670) offers PMS and Mutual Funds products. Motilal Oswal Wealth Management Ltd. (MOWML): PMS (Registration No.: INP000004409) offers wealth
management solutions. *Motilal Oswal Securities Ltd. is a distributor of Mutual Funds, PMS, Fixed Deposit, Bond, NCDs, Insurance and IPO products. * Motilal Oswal Commodities Broker Pvt. Ltd. offers Commodities
Products. * Motilal Oswal Real Estate Investment Advisors II Pvt. Ltd. offers Real Estate products. * Motilal Oswal Private Equity Investment Advisors Pvt. Ltd. offers Private Equity products
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