Review and details of Home First Finance Company's (HFFC) initial public offering. HFFC IPO Stock Price, Date, News

Upcoming 2021 IPO: About Home First Finance Company (HFFC) In this IPO review, we look at the date, price, price band, lot size, and Home First Finance Company business (HFFC). Let's look at it. Talk about mood, home first, pros and cons. Finance Company (HFFC) and its financial backers.

Home First Finance Company (HFFC) IPO Review and Details

Hello friends! When we talk about the loan business, the first name that comes to mind is banks, which provide different types of loans to consumers. Some examples are auto loans, personal loans, and home loans. You may also find that NBFC also runs a loan business that offers a variety of loans.

But there is a special type in which the NBFC offers loans to (special) people. This category is called home loans. There are many companies / NBFCs listed in the stock market like LIC HFL, Indiabulls Housing Finance, GIC Housing Finance.

These companies specialize in consumer loans in the housing sector. In this category, there is a new NBFC that will run with your IPO (recent). You can bid on your IPO. This is called home-first finance. We will talk in detail about its IPO. We have divided this video into three parts.

Share HFFC's initial public offering

We'll talk about the industry first, then business, finance, and company professionals.

At the end of the article, I will talk about the important dates that are important to you if you are interested in the company's IPO. Without further ado, let's talk about the industry first.

India's home finance industry is worth more than Rs 2 trillion. (Exactly) The value of this industry (housing finance) is Rs. 20.7 million. Whenever we talk about the home finance industry, there are two major players. The first is banks. You can go to any bank and ask for a loan for your home.

Second, there are NBFCs. These are specialized companies that only provide home loans. I will divide the Rs 20.7 lakh industry here into two parts. The former are the banks that have the largest share in the housing finance sector.

It has a market share of Rs. 13.6 million. The market share of housing finance companies is Rs 7.1 million.

Between 2015 and 2019, the sector's CAGR grew by 20%. The Crisil report says that by 2022, the number of loans in the housing sector will reach Rs 28.4 million.

Now we talk about the drivers that are growing in the whole industry, that is, the factors that are growing in the whole industry. There are some factors that increase population and increase citizenship. As the population grows and cities move, so does the demand for affordable housing. In addition, government action has been taken in recent days. Schemes like the Prime Minister's Awas Yojana create housing demand.

When people benefit from these projects, they build new houses and benefit from them. Develop the industry. Total loans provided by the housing finance industry can be divided into two categories. The first is affordable housing and the second is ordinary household debt.

Home Finance runs its business in affordable housing. Since 2015-19, 5 CAGRs have been observed in affordable housing. The highest rates of affordable housing have come mainly from the two states of Maharashtra and Gujarat. Out of the total market of the Housing Financing Sector (ie Affordable Housing Financing Sector), this company is present in 79% of the market. So it was a debate about the industry. Now let's talk about this company. The company was started in 2010.

As of September 2019, the company is divided into 65 states, including Tamil Nadu, Karnataka, Maharashtra, and Gujarat. The company has branches in these states and operates there. The company has two client bases: salaried and self-employed. The main customer base is the salaried employees. About 72% of these loans go to salaried employees. While 24% loan has been given to self-employed. It focuses on both users. The biggest focus of this loan book is on salaried employees. Let's talk in detail about the business of this company.

HFFC Company Business

It lends to consumers for the construction of houses where their loan is a valuable contribution of Rs. In addition, the company repurchases loans. If you want to take out a loan against a property, the company operates there with a 4% share in its loan book. In addition, the company provides financial support to developers if they need money. But their main focus is home finance, which accounts for 91% of the debt book. The remaining 9 are distributed in different places.

HFFC Company Financing

Let's move on to the company's finances. Let's talk about it. First, I will talk about the company's revenue and profits. Next, I will present an interesting analysis of this industry where I will compare this company with other competitors.

First, let's talk about the company's profits and revenue. Let's look at the trend in recent years.

The company's revenue and profits have been trending in recent years. In March 2018, the company had a revenue of Rs 13.4 million, of which it made a profit of Rs 150 million. But in 2019, the company's revenue almost doubled. Its profit increased to Rs 45 million. As of March 2020, the company's revenue and profit were Rs. 419 million and (approximately) Rs. 79.2 million, respectively. From this, you can understand that in recent years the company has seen a tremendous increase in finances, revenue and profits. In the last three years, there has been a steady increase. As of September 30, 2020, the company and PAT had semi-annual revenues of Rs 2,453 crore and Rs 50 crore, respectively.

Here you can see that the company's trend has continued for the last three years. Its semi-annual results are remarkable.

CAGR's revenue growth for the previous year is about 60%. The company's revenue for the same period is close to CAGR 122. So this was the latest financial trend of the company. Let's compare the number of this company with the whole company. The industry in which this industry operates is Housing Finance NBFC. Let's quickly compare this company to the industry and see where it stands.

I have divided the different parameters into 5 different companies. The five companies we have considered are HDFC, LIC Housing Finance, Avas Financier, India Bliss Housing, and HFFC.

We will compare them with different parameters. HDFC has the first largest market position in the industry. LIC and Individuals follow it. India Bills have a market capitalization of Rs 10,000 crore. Based on the price at which HFFC has launched an IPO, its market capitalization is around Rs 45 billion. Now let's talk about P / B value.

This is an important parameter whenever we compare any company in the financial sector. A lower P / B value is considered better for the company. The price of HFFC books in this sector really. Is more Its P / B price is around Rs. HDFC and LIC Housing Finance have a P / B value of 3 and 1, respectively. AAVAS financiers have the highest P / E value in the entire industry. Now, compare the P / E ratio. India Bliss has the lowest P / E ratio in the industry at around 7.75. They are followed by LIC Housing Finance and HDFC with a KP / E ratio of 7.86 and 26, respectively. An interesting fact here is that the price at which the first treasurer brings his IPO at home makes his P / E ratio 48.

This is much bigger than the other competitor. Now let's talk about the percentage of IRO. The company has an ROE of 8.49%. That's a lot less than other players. Now let's talk about net interest margin. This is the difference between bowing and paying a bribe. This is the margin (delta) that a company has earned. High-interest margins are considered good for business. The company's net interest margin is about 5. 5.40%. Key players such as HDFC, LIC Housing Finance, and Awas Financier have the interest of 3.30%, 2.34%, and 6.40% respectively.

One of the great things about this company's high interest margins is that the affordable housing industry charges higher interest rates than other players. NBFCs operating in the home finance sector will have higher interest rates than other companies.

Now let's talk about NPAs. Non-performing assets are essential for the entire NBFC industry. Describes the quality of a company's assets. Without further ado, let's talk about the company's non-performing assets. Home finance gross NPA is 1% and net NPA is about 0. 0.8%.

Let's talk about other companies. HDFC, LIC, and Awas have combined NPAs of 2.70%, 2.86%, and 0.46%, respectively. From here you can see that this company is performing better than other companies in terms of overall NPAs. The same trend is found in the case of Net NPAs (excluding Awas Financial). The company's capital adequacy ratio is approximately 47.70%. This number must be more than 15% as per RBI guidelines. This company is quite safe in this regard and its CAR number can be considered very good.

Professionals and investment opportunities in this IPO

Now, let's move on to the next part of the article. Here we will talk about the pros and cons of investing in this IPO. The points to pay attention to.

I will talk about this profession first. The first supporter is emerging citizenship. In recent times, the population has increased and more and more people are moving to cities. This will increase the demand for housing (especially as citizens will increase the demand for affordable housing). If citizenship is maintained, the growth prospects of these companies also increase. This is an opportunity for them in the future.

Second, the pro-government government has initiated measures like housing, Prime Minister's Awas Yojana. By 2022. The government's goal here is to make every family home. People who do not have a home usually fall into the category of affordable housing. If there is a crackdown in this regard in the future. If it is created, there will be further development in this field. But let me tell you again, the future is hard to predict. That was a point of contention that I discussed.

The next supporter comes from the company's financial support. Your company's net profit margin is impressive. We compare it to other players.

NPA is an important factor for the entire industry. The company has also performed well in this regard. The company's net NPA is less than 1% and gross NPA is close to 1%. This can be understood in large numbers. The performance of the company has been excellent in the last 3 years. One positive thing is that your chart is constantly improving and growing. Revenue, profits, and margins have improved year on year.

Now, let's move on to the next part where we will talk about awareness (related to IPO investment).

More importantly, banks have a large share of market share. The big players working here have a huge presence in the industry. In addition, big brands work in this field. It is difficult to bring in new players. Although the company has now performed well, its performance will now be known in comparison to its peers.

Banks have a stronger presence than home finance companies. Home finance companies have increased their market share from 35% in 2015 to 39% in 2019, but the market share of banks is still 61%. From this, it can be understood that banks dominate the entire sector. How this company challenges them and snatches their market share will be known in the future.

The next important point is a large part of the business with salaried employees. Too many jobs lost during code. You should consider the impact of the company's NPAs in the near future. Whenever there is a shortage of jobs, the company's business can suffer. You need to take note of this.

The third important factor is the company's diversified business. The main business of the company mentioned in the article is beyond Maharashtra and Gujarat. The diversity of this company and its involvement in other states is important to you as an investor.

There is another important factor that I want to discuss. Earlier, the National Housing Bank regularized the housing sector. In August 2019, the RBI took over the organization. The RBI now tightly controls the sector and may have stricter standards in the future. After that, new policies in the future become an important factor you need to know about.

So it was about the profession.

HFFC IPO date and share price

Now, let's move on to the important dates of this company that you should know if you want to bid for this company.

The size of the entire IPO is Rs 1,153 crore. Most IPOs are for sale. We have talked about this offer many times. This is the size of the IPO when the promoters sell their bets. The amount is Rs 888 million.

The share price of this IPO is between Rs. 517-518. The lot size is 28 shares.

If you bid on 1 lot, the minimum bid will be L L5 for 28 shares which will be priced between Rs. 517-518.

The IPO opening date is January 21. You can bid on this IPO between January 21-25. The period is long because when the bidding does not start, there is a week in between. You can bid for this IPO on business days between January 21-25. The provisional listing date is February 3. This may change in the future.

We talk about the whole industry, business, and company finances.

We create all topics for educational purposes. We do not recommend buying or selling.

The joy of investing!