INDIABULLS HOU. FIN. 2021-22 Annual Report Analysis

Thu, 31 Mar

INDIABULLS HOU. FIN. has announced its results for the year ended March 2022. Let us have a look at the detailed performance review of the company during the year 2021-22.

INDIABULLS HOU. FIN. Income Statement Analysis

• Interest income during the year fell 9.5% on a year-on-year (YoY) basis.
• Interest expenses were down by 10.1% YoY during the same period.
• Operating expenses declined by 18.0% YoY during the year.
• The company's net interest income (NII) decreased by 8.2% YoY during the fiscal. Consequently, net interest margins (NIM) witnessed a decline and stood at 3.9% in FY22 as against 4.1% in FY21.
• Other income declined by 35.2% YoY during the year.
• Net profit for the year declined by 2.0% YoY.
• Net profit margins during the year increased to 13.1% in FY22 from 12.1% in FY21.

INDIABULLS HOU. FIN. Income Statement – 2021-22

No. of Mths Year Ending		12 Mar-21*	12 Mar-22*	% Change
Interest Income	Rs m	99,274	89,833	-9.5%
Other Income	Rs m	1,027	666	-35.2%
Interest Expense	Rs m	69,394	62,416	-10.1%
Net Interest Income	Rs m	29,880	27,417	-8.2%
Operating Expense	Rs m	14,324	11,751	-18.0%
Pre-provision Operating Profit	Rs m	16,584	16,331	-1.5%
Provisions & Contingencies	Rs m	145	152	5.0%
Profit before tax	Rs m	15,617	15,558	-0.4%
Tax	Rs m	3,601	3,780	5.0%
Profit after tax	Rs m	12,016	11,777	-2.0%
Minority Interest	Rs m	0	0	0.0%
Net Interest Margin	%	4.1	3.9
Net profit margin	%	12.1	13.1

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INDIABULLS HOU. FIN. Balance Sheet Analysis

• The company's deposits during FY22 stood at Rs 0 m as compared to Rs 0 m in FY21, thereby witnessing an increase of 0.0%.
• Advances for the year stood at Rs 599.5 bn as compared to Rs 654.1 bn during FY21, a fall of 8.3%.
• Cost of deposits for INDIABULLS HOU. FIN. rose 0.0% and stood at 0.0%, while yield on advances rose to 0.0%.
• The lender's investments rose to Rs 99.0 bn during the year from Rs 83.5 bn in FY21.
• Borrowing stood at Rs 144.8 bn, a growth of 31.7% as compared to previous year.
• Overall, the total assets and liabilities for FY22 stood at Rs 814.2 bn as against Rs 925.7 bn during FY21, thereby witnessing a fall of 12.0%.

INDIABULLS HOU. FIN. Balance Sheet – as on March 2022

No. of Mths Year Ending		12 Mar-21*	12 Mar-22*	% Change
Networth	Rs m	159,463	164,958	3.4%
Advances	Rs m	654,073	599,502	-8.3%
Deposits	Rs m	0	0	0.0%
Yield on advances	%	0.0	0.0
Cost of Deposits	%	0.0	0.0
Investments	Rs m	83,470	99,006	18.6%
Borrowings	Rs m	110,001	144,830	31.7%
Total Assets	Rs m	925,683	814,178	-12.0%

Current Valuations for INDIABULLS HOU. FIN.

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 26.4, an improvement from the EPS of Rs 27.0 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 157.8, stands at 8.4 times its trailing twelve months earnings.
• The price to adjusted book value (P/ABV) ratio at current price levels stands at 0.5 times, while the price to income ratio stands at 1.1 times.

Per Share Data/Valuations

No. of Mths Year Ending		12 Mar-21*	12 Mar-22*
Income per share (Unadj.)	Rs	222.9	201.6
Earnings per share (Unadj.)	Rs	27.0	26.4
Diluted earnings per share	Rs	25.5	25.0
Avg P/E ratio	Rs	6.5	8.4
Avg P/ABV ratio	Rs	0.6	0.5
Avg Market Cap	Rs	78,404	98,850
Dividends per share (Unadj.)	Rs	9.00	0.00

Ratio Analysis for INDIABULLS HOU. FIN.

• Efficiency Ratios

  Credit/Deposit Ratio: The company's credit/deposit ratio deteriorated and stood at 59,950,190.0x during FY22, from 65,407,250.0x during FY21. The credit/deposit ratio tells us how much money a company has raised in the form of deposits and has deployed as loans.

  Debt to Equity Ratio: The company's debt to equity ratio increased and stood at 0.88x during FY22, from 0.69x during FY21. The debt to equity ratio of a company tells us how much debt a company uses relative to its equity.

• Liquidity Ratios

  Capital Adequacy Ratio (CAR): INDIABULLS HOU. FIN.'s capital adequacy ratio (CAR) was at 22.5% as on 31 March 2022 as compared to 22.8% a year ago. This ratio helps measure the financial strength of the company or any finance company to meet their obligations using their assets and capital.

  A company that has a good CAR has enough capital to absorb potential losses. Thus, it has less risk of becoming insolvent and losing depositor's money.

  Provision Coverage Ratio (PCR): Apart from CAR, you also need to take a look at the company's PCR and LCR ratios. Provisioning coverage ratio (PCR) is the percentage of funds that a company sets aside for covering losses due to bad debts.

  So a high PCR ratio means asset quality issues are under control and the company is not vulnerable.

  Liquidity Coverage Ratio (LCR): The LCR is designed to ensure that companies hold a sufficient reserve of high-quality liquid assets to allow them to survive a period of significant liquidity stress lasting 30 calendar days.

• Profitability Ratios

  Return on Equity (ROE): The return on equity (ROE) ratio for the company deteriorated and stood at 7.1% during FY22, from 7.5% during FY21. The ROE measures the ability of a firm to generate profits from its shareholders capital in the company.

  Return on Assets (ROA): The return on asset (ROA) ratio of the company improved and stood at 1.45% during FY22, from 1.30% during FY21. The ROA measures how efficiently the company uses its assets to generate earnings.

  Return on Capital Employed (ROCE): The ROCE for the company improved and stood at 9.57% during FY22, from 9.44% during FY21. The ROCE measures the ability of a company to generate profits from its total capital (shareholder capital plus debt capital) employed in the company.

• NPA Ratios

  Gross NPA Ratio: The gross NPA ratio is the ratio of a company's gross NPAs to gross advances. INDIABULLS HOU. FIN.'s gross NPA ratio stood at 3.2% as of 31 March 2022 compared to 2.7% in the same period a year ago.

  A high gross NPA ratio is a bad thing as it indicates how much of a company's loans are in danger of not being repaid.

  Net NPA Ratio: In simple language, net NPAs are simply the total non-performing assets minus the provision left aside. It gives you the exact value of NPAs after the company has made provisions.

  The net NPA ratio of INDIABULLS HOU. FIN. was 2.3% in financial year 2022. This compared with 1.6% a year ago.

Key Ratio Analysis

No. of Mths Year Ending		12 Mar-21*	12 Mar-22*
Credit/Deposit Ratio	x	65,407,250.0	59,950,190.0
Debt to Equity Ratio	x	0.7	0.9
Loans / Deposits	x	0.0	0.0
Capital Adequacy Ratio	%	22.8	22.5
Return on Equity	%	7.5	7.1
Return on Assets	%	1.3	1.4
Return on Capital Employed	%	9.4	9.6
% of Gross NPAs	%	2.7	3.2
% of Net NPAs	%	1.6	2.3
Yield on Advances	x	0.0	0.0
Yield on Investments	x	0.0	0.0

To see how INDIABULLS HOU. FIN. has performed over the last 5 years, please visit here.

INDIABULLS HOU. FIN. Share Price Performance

Over the last one year, INDIABULLS HOU. FIN. share price has moved down from Rs 196.5 to Rs 157.8, registering a loss of Rs 38.7 or around 19.7%.

Overall, the S&P BSE SENSEX is up 16.8% over the year.

(To know more, you can check out historical annual results for INDIABULLS HOU. FIN. here and quarterly results for INDIABULLS HOU. FIN. here)

Read: Latest Annual Report Analysis of INDIABULLS HOU. FIN.