HomeBusiness NewsCompanies NewsPNB Housing Finance eyes 17-18% growth in retail loan book over next couple of years
PNB Housing Finance eyes 17-18% growth in retail loan book over next couple of years
Girish Kousgi, MD & CEO of PNB Housing Finance expects the RBI to announce some liquidity easing measures in the upcoming monetary policy. A rate cut is likely in the next policy in February.
PNB Housing Finance aims to grow its retail loan book, which is now about 98% of overall book, by 17-18% over the next couple of years.
MD & CEO Girish Kousgi told CNBC-TV18 that the target is to increase the retail loan book to ₹1 lakh crore by 2026-27 (FY27), with a well-balanced distribution across the affordable, emerging, and prime segments.
"By 2026-27, the split of ₹1 lakh crore retail book is going to be ₹15,000 crore in affordable, ₹25,000 crore in emerging, and the balance ₹60,000 crore would be prime," he said.
Kousgi also shared his expectations on the upcoming RBI monetary policy scheduled for December 4 to 6.
"There could be certain liquidity easing measures which could be taken, probably in this MPC, but definitely next MPC rate cut is going to come in," he said.
The current market capitalisation of the company stands at ₹23,724.95 crore.
This is the verbatim transcript of the interview.
Q: Let's talk about the second half. How strong is growth looking and what are the sanction expectations, and disbursals, what are you working with for the second half of the current fiscal year?
A: Last year, the growth in retail was 14.1%, in June, the growth was 14.4% and July-September 2024 (Q2FY25) quarter, the growth was 16.2% against a guidance of 17%. So this year we will be able to breach that 17% guidance on retail book growth.
Q: Give us the difference between yields and the margin profile of all of these segments. How does affordable compare with the mass segment, and what makes you optimistic of reaching that ₹1 lakh crore mark as well by the 2026-27 fiscal year?
A: If you grow at about 17-18%, we will get to ₹1 lakh crore by 2026-27 and by 2026-27, the split of ₹1 lakh crore retail book is going to be ₹15,000 crore affordable, ₹25,000 crore emerging, and the balance ₹60,000 crore would be Prime.
Also Read | PNB Housing Finance Block Deal: 9.5% equity worth ₹2,300 crore changes hands
In addition to this, we plan to restart corporate in the next couple of months. So book by 2026-27 will be about ₹7,000-8,000 crore. In terms of all the three segments within retail, out of four - that is Super Prime, Prime, Emerging and Roshni - we don't focus on Super Prime. So on Prime, the yield is going to be about 9.5%, the Emerging yield will be about 10.5%, and Roshni from the coming year will be about 13%.
Q: Help us out with the net interest margins (NIMs) guidance from hereon and going by the yields that you are talking about, what will your return on assets (RoAs) look like as your book scales up?
A: If we talk about NIM, we have guided 3.5%. We have been maintaining about 3.6% to 3.65% for the last few quarters. For the next few quarters, we will be able to maintain NIM at the current level. And from next year onwards, NIMs will start inching up.
In terms of RoA, currently, we are at about 2.4-2.45%. Standalone by 2026-27, NIMs should be around 3.9-4% types, and RoA should be about 2.5-2.6%.
Q: At least from a market point of view, all attention on the monetary policy this Friday (December 6) and whether there will be something which will be coming, maybe not an outright rate cut, but a cash reserve ratio (CRR) cut, some liquidity measures, etc. Any expectations from your side?
A: The expectation will be before March, definitely rate cut is going to come in. I am not sure about this month, but definitely in February, it is expected. There could be certain liquidity easing measures which could be taken, probably in this MPC, but definitely next MPC rate cut is going to come in.
For more details, watch the accompanying video
Catch all the latest updates from the stock market here
MD & CEO Girish Kousgi told CNBC-TV18 that the target is to increase the retail loan book to ₹1 lakh crore by 2026-27 (FY27), with a well-balanced distribution across the affordable, emerging, and prime segments.
"By 2026-27, the split of ₹1 lakh crore retail book is going to be ₹15,000 crore in affordable, ₹25,000 crore in emerging, and the balance ₹60,000 crore would be prime," he said.
Kousgi also shared his expectations on the upcoming RBI monetary policy scheduled for December 4 to 6.
"There could be certain liquidity easing measures which could be taken, probably in this MPC, but definitely next MPC rate cut is going to come in," he said.
The current market capitalisation of the company stands at ₹23,724.95 crore.
This is the verbatim transcript of the interview.
Q: Let's talk about the second half. How strong is growth looking and what are the sanction expectations, and disbursals, what are you working with for the second half of the current fiscal year?
A: Last year, the growth in retail was 14.1%, in June, the growth was 14.4% and July-September 2024 (Q2FY25) quarter, the growth was 16.2% against a guidance of 17%. So this year we will be able to breach that 17% guidance on retail book growth.
In terms of the next couple of years, we plan to grow at about a little over 17-18% on retail books because largely now in the overall portfolio retail is about 98%. Overall book is about ₹69,500 crore, and retail is about ₹68,000 crore. So out of this, our focus is going to be on the affordable housing segment, which is Roshni Home Loans. The emerging housing segment and Prime housing segment will grow at a slower pace. The growth in Prime is going to be about 9%. Growth in Emerging is going to be over 30% for the next two to three years. And the growth in affordable, considering the base is quite small, we have just crossed a book of ₹3,000 crore, so the growth is going to be slightly higher on the Roshni.
Q: Give us the difference between yields and the margin profile of all of these segments. How does affordable compare with the mass segment, and what makes you optimistic of reaching that ₹1 lakh crore mark as well by the 2026-27 fiscal year?
A: If you grow at about 17-18%, we will get to ₹1 lakh crore by 2026-27 and by 2026-27, the split of ₹1 lakh crore retail book is going to be ₹15,000 crore affordable, ₹25,000 crore emerging, and the balance ₹60,000 crore would be Prime.
Also Read | PNB Housing Finance Block Deal: 9.5% equity worth ₹2,300 crore changes hands
In addition to this, we plan to restart corporate in the next couple of months. So book by 2026-27 will be about ₹7,000-8,000 crore. In terms of all the three segments within retail, out of four - that is Super Prime, Prime, Emerging and Roshni - we don't focus on Super Prime. So on Prime, the yield is going to be about 9.5%, the Emerging yield will be about 10.5%, and Roshni from the coming year will be about 13%.
Q: Help us out with the net interest margins (NIMs) guidance from hereon and going by the yields that you are talking about, what will your return on assets (RoAs) look like as your book scales up?
A: If we talk about NIM, we have guided 3.5%. We have been maintaining about 3.6% to 3.65% for the last few quarters. For the next few quarters, we will be able to maintain NIM at the current level. And from next year onwards, NIMs will start inching up.
In terms of RoA, currently, we are at about 2.4-2.45%. Standalone by 2026-27, NIMs should be around 3.9-4% types, and RoA should be about 2.5-2.6%.
Q: At least from a market point of view, all attention on the monetary policy this Friday (December 6) and whether there will be something which will be coming, maybe not an outright rate cut, but a cash reserve ratio (CRR) cut, some liquidity measures, etc. Any expectations from your side?
A: The expectation will be before March, definitely rate cut is going to come in. I am not sure about this month, but definitely in February, it is expected. There could be certain liquidity easing measures which could be taken, probably in this MPC, but definitely next MPC rate cut is going to come in.
For more details, watch the accompanying video
Catch all the latest updates from the stock market here
Live TV
Loading...
Check out our in-depth Market Coverage, Business News & get real-time Stock Market Updates on CNBC-TV18. Also, Watch our channels CNBC-TV18, CNBC Awaaz and CNBC Bajar Live on-the-go!