{"id":443,"date":"2019-11-11T11:15:10","date_gmt":"2019-11-11T11:15:10","guid":{"rendered":"http:\/\/www.assetmultiplier.co.in\/blog\/?p=443"},"modified":"2019-11-11T11:15:11","modified_gmt":"2019-11-11T11:15:11","slug":"indiabulls-housing-finance-maintains-healthy-cash-balance-on-the-balance-sheet","status":"publish","type":"post","link":"https:\/\/www.assetmultiplier.co.in\/blog\/2019\/11\/11\/indiabulls-housing-finance-maintains-healthy-cash-balance-on-the-balance-sheet\/","title":{"rendered":"Indiabulls Housing Finance: Maintains healthy cash balance on the balance sheet"},"content":{"rendered":"\n<p><strong>Update on the Indian Equity Market:\n\n<\/strong><\/p>\n\n\n\n<p>On\n Friday, NIFTY closed ~104 points lower at 11,908 points.\nInternational rating agency Moody&#8217;s Investors Service downgraded India&#8217;s\noutlook to negative from stable on concerns that the country&#8217;s economic \ngrowth will\nremain materially lower than in the past. The negative sentiment led to a\nselloff in the stock market. Amongst the NIFTY 50 Stocks, YESBANK \n(+4.8%),\nINDUSINDBK (+2.9%), ICICIBANK (+2.4%) were the largest gainers; while \nINFRATEL\n(-4.9%), SUNPHARMA (-4.3%) and GAIL (-3.9%) were the top losers. The \ngovernment\u2019s announcement to set up an Alternative Investment Fund (AIF)\n in aid of the\nstalled housing projects kept the sentiment positive for the NIFTY \nREALTY index\nwhich closed higher by 1.7%. PRIVATE BANK was the only other sector in \nthe\nNIFTY sector indices, to close in the green. NIFTY Pharma (-2.2%), PSU \nBANK (-1.9%), FMCG (-1.8%) were\namongst the top losers for the day.<\/p>\n\n\n\n<p><strong>Indiabulls Housing Finance: Maintains healthy cash balance on the balance sheet<\/strong><\/p>\n\n\n\n<p><span style=\"text-decoration: underline;\">Key takeaways from the interview of Mr Gagan Banga, MD Indiabulls Housing Finance; dated 8<\/span><sup><span style=\"text-decoration: underline;\">th<\/span><\/sup><span style=\"text-decoration: underline;\"> November 2019 on CNBC TV-18: <\/span><\/p>\n\n\n\n<ul><li>Indiabulls Housing Finance (IBHFL) maintains 20% of the balance sheet in cash; covering around the next 12 months liabilities. The cash balance is monitored on a daily basis. IBHFL continues to carry cash at similar levels as Sept-2019 less the amount of buyback done in October and early November 2019.<\/li><li>Mr Banga mentioned that in the last 13-14 months, the Housing Finance Companies (HFC) suffered because of the liquidity  crisis. The market lost confidence in HFC. IBHFL\u2019s suffering got  exaggerated because of the various allegations and the attempt to merge with Lakshmi Vilas  Bank. <\/li><li>IBHFL\u2019s stakeholders are confident about the solvency with 20% of the balance sheet as cash and a capital adequacy ratio of 29%. Risky perception of the book is due to wholesale lending. However, for the last 10 years; IBHFL\u2019s business has been in line with what the HFC charter permits. <\/li><li>In the event of various allegations, IBHFL has subjected itself to diligence. Multiple regulators and agencies have looked at the transactions in question and the overall book of IBHFL.<\/li><li>Talking about the governments\u2019 announcement to set up an Alternative Investment Fund (AIF) to help complete the stalled housing projects, Mr Banga mentioned that it is a positive development in the right direction. It may take a couple of months for implementation with the setting up of the fund and the money to start flowing. The lenders and developers are content to see the government thinking of de-clogging the real estate sector.<\/li><\/ul>\n\n\n\n<p>Consensus Estimate (Source: market screener and<a href=\"http:\/\/investing.com\"> investing.com<\/a> website)<\/p>\n\n\n\n<ul><li>The\nclosing price of IBHFL was \u20b9 242\/- as of 8-November-19. It traded at 0.6x \/ 0.5x\n\/ 0.5x the consensus Book Value for FY20E \/ 21E \/ 22E of \u20b9 437 \/ 487 \/ 475 respectively.<\/li><li>Consensus\ntarget price of \u20b9 467\/- implies a Price to Book multiple of 1x on FY22E Book\nValue of \u20b9 475\/-.<\/li><\/ul>\n","protected":false},"excerpt":{"rendered":"<p>Update on the Indian Equity Market: On Friday, NIFTY closed ~104 points lower at 11,908 points. International rating agency Moody&#8217;s Investors Service downgraded India&#8217;s outlook to negative from stable on concerns that the country&#8217;s economic growth will remain materially lower than in the past. The negative sentiment led to a selloff in the stock market. [&hellip;]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[40,54],"tags":[152,153,60,149,155,45,151,150],"_links":{"self":[{"href":"https:\/\/www.assetmultiplier.co.in\/blog\/wp-json\/wp\/v2\/posts\/443"}],"collection":[{"href":"https:\/\/www.assetmultiplier.co.in\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.assetmultiplier.co.in\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.assetmultiplier.co.in\/blog\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.assetmultiplier.co.in\/blog\/wp-json\/wp\/v2\/comments?post=443"}],"version-history":[{"count":1,"href":"https:\/\/www.assetmultiplier.co.in\/blog\/wp-json\/wp\/v2\/posts\/443\/revisions"}],"predecessor-version":[{"id":444,"href":"https:\/\/www.assetmultiplier.co.in\/blog\/wp-json\/wp\/v2\/posts\/443\/revisions\/444"}],"wp:attachment":[{"href":"https:\/\/www.assetmultiplier.co.in\/blog\/wp-json\/wp\/v2\/media?parent=443"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.assetmultiplier.co.in\/blog\/wp-json\/wp\/v2\/categories?post=443"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.assetmultiplier.co.in\/blog\/wp-json\/wp\/v2\/tags?post=443"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}