Technically LHFL (CMP:436) has strong resistance of around 453-473 zone and only consecutive closing above 473, it may target 488-510 area. Sustaining above 510,it may scale up to 580-600 territory in the mid to long term (low probability as of now, after the muted result).
On the down side, immediate support is 421-415 & sustain below that, 399-388 area may be the short term target (High Probability, after the muted result). Consecutive closing below 388, LHFL may fall to 376 area and sustaining below that, 357-333-310-300 zone may be on the card (But, fall below 388-376 is a low probability in the current market scenario).
On Saturday, LHFL had published its Q4 result ( Actual EPS 27.65, may be well below market expectations). Though head line numbers are muted, net interest income and loan disbursements showed a healthy growth of around 22-23%.
Company management is confident about improvement in asset quality (NPA) & loan growth in the coming quarters. LHFL is the second largest Housing Finance Company (NBFC) of India and has wide distribution network with backing of a trusted brand name like LIC (having around 40% stake in LHFL). It is also likely a strong contender of some form of Banking License.
Looking ahead, in the environment of "Affordable Housing" theme, lower interest rate, stable / improved asset quality & expected infrastructure boom in our country, LHFL may be one of the major beneficiary.
As par BG metrics of TF model, median valuation of LHFL is around 485 (by considering its actual TTM EPS of around 23). If we assume, projected FWD EPS of around 34.50 (FY-17), its median value may be around 595 under the current market conditions.
| SCRIP | EPS(TTM) | BV(Act) | P/E(AVG) | LONG TERM | SHORT TERM | MEDIAN VALUE | 200-DEMA | 10-DEMA |
| LICHSGFIN | 23.05 | 149.26 | 24.07 | 470.56 | 501.32 | 485.94 | 399.1 | 452.99 |
| LICHSGFIN | 28.1 | 173 | 24.07 | 519.56 | 553.52 | 536.54 | 399.1 | 452.99 |
| LICHSGFIN | 34.5 | 200 | 24.07 | 575.69 | 613.33 | 594.51 | 399.1 | 452.99 |
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