SRG Housing Finance LtdQ4 FY22
SRG Housing Finance Ltd
Q4 FY22 Earnings Call Analysis
Management growth scorecard
Revenue
Category 3
Margin
Category 3
Fundraise
Yes
Order
Yes
Capex
No
2 of 5 growth signals are positive.
Full analysisRevenue guidance
Category 3- →Post-COVID normalization shows positive business momentum with improved disbursements in Q3 FY21 (Rs. 26.77 crore, 161.68% growth YoY).
- →Total loan book grew by 7.73% QoQ to Rs. 303.11 crore.
- →Expected to clarify growth trajectory for FY22 after Q4 results.
- →Lenders have increased confidence due to no moratorium availed; ready to support higher leverage.
- →Target leveraging up to 7-8 times capital to reach loan book size of Rs. 500-700 crore.
- →Focus on deepening business within existing branches and geographies rather than expanding to new districts in the short term.
- →Market positivity expected due to COVID-19 vaccine availability and government funding initiatives.
- →Rating agencies urged to adopt positive outlook to sustain NBFC financing and growth.
- →Long-term growth driven by untapped rural loan market (only about 2-2.5% of India’s population currently availing loans).
Margin guidance
Category 3- →Growth outlook for FY22 is cautiously optimistic but clarity will emerge only after Q4 FY21 results.
- →With availability of COVID-19 vaccine, economic activities are picking up, supporting business growth.
- →The company expects to bridge past growth interruptions caused by liquidity crunch and aims for significant portfolio expansion.
- →Leverage can be increased up to 7-8 times current capital, potentially enabling loan book growth to Rs. 500-700 crore.
- →Q3 saw a 10.92% PAT growth (Rs. 5.69 crore) and 13.64% total income growth, indicating improving profitability trends.
- →Management foresees 2022 as a ‘historic year’ for growth but will finalize targets after assessing Q4 performance.
- →Positive funding environment post-budget and strong lender confidence are expected to fuel growth.
- →Sustained focus on collections, low NPAs, and operational efficiencies support stable earnings expansion.
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Fundraise plans
Yes- →The company has raised Rs. 125 crore funding in the last nine months, including Rs. 25 crore through debentures in the latest quarter.
- →Current total borrowings stand at Rs. 305.70 crore with a comfortable liquidity position (liquid funds at Rs. 91 crore and Rs. 15 crore un-drawn sanction).
- →Vinod Kumar Jain mentioned they have capacity to leverage up to 7-8 times their capital (~Rs. 100 crore), targeting a loan book size of Rs. 500-700 crore without additional capital.
- →They can leverage up to 15x as per NHB regulations but currently do not require more capital. Whenever additional growth funding is needed, they plan to raise equity.
- →NSE listing application planned to be moved post-March results, indicating potential future equity market access.
- →Existing lenders are confident and proactively supporting fresh funding requirements for growth in FY22.
Order book
YesThe transcript provided does not specifically mention current or expected orderbook or pending orders for SRG Housing Finance Limited. The discussion primarily focuses on:
- Loan book growth: Rs. 303.11 crore as of Q3 FY21, with 7.73% growth QoQ.
- Disbursement trends: Rs. 26.77 crore in Q3 FY21 (161.68% YoY growth), Rs. 53.37 crore in 9 months (54% growth).
- No explicit mention of orderbook or pending orders, as the company operates in housing finance rather than order-based business.
- Plans for business growth: leveraging current branches fully before geographic expansion.
- Focus on loan book growth through increased disbursement and leveraging existing liquidity.
Hence, no direct information on orderbook or pending orders is available in the transcript.
Capex plans
NoThe transcript does not mention any specific current or future capex, capital investment, or strategic investment plans by SRG Housing Finance Limited. Key related points are:
- The company focuses on organic growth through existing branch networks and does not plan expansion into new districts in the next 6-12 months, leveraging capacity in current branches.
- Leverage capacity exists up to 7-8 times capital; they have capital and capacity to grow loan book up to Rs. 700-800 crore without additional equity.
- Equity infusion will be considered in the future if required, but currently, the company is comfortable raising funds via debt (NCDs, bank loans).
- No mention of strategic investments or capex on infrastructure or technology; focus seems to be on employee training (Program ‘Pathshala’) to enhance efficiency.
Therefore, no explicit capex or strategic investment plans were disclosed in this call.
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