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Informist, Friday, Oct. 17, 2025

By Udita S. Jaiswal

MUMBAI - Can Fin Homes Ltd. is expected to report a healthy net interest income and profit after tax on the back of improved loan rates in the September quarter, according to analysts. Lower cost of funds and stable yields may also increase the company's net interest income, analysts said.

Can Fin Homes, the housing finance company subsidiary of Canara Bank, is expected to report a net profit of INR 2.30 billion for the September quarter, up nearly 9% on year, according to the average of the estimates of five broking firms. Prabhudas Lilladher Pvt. Ltd. has the lowest estimate of INR 2.18 billion for net profit while the highest estimate of INR 2.43 billion is from YES Securities (India) Ltd.

The company's net interest income for the reporting quarter is expected to be INR 3.73 billion for the reporting quarter, up nearly 10% on year, according to the average of the five estimates. The lowest estimate for net interest income is INR 3.58 billion from Nirmal Bang Equities Pvt. Ltd. while the highest estimate of INR 3.89 billion is from YES Securities (India) Ltd.

The net interest margin of Can Fin Homes is expected to fall 11 basis points on quarter to 2.93% due to increased competition from banks and the impact of the interest rate cuts. "Rate cut impact would be higher for HFCs (Housing Finance Companies) compared to banks since housing loans are floating in nature," Prabhudas Lilladher said.    

Net interest margins are expected to be lower across the banking and financial services sector in the September quarter following the 100-bps reduction in the policy repo rate by the Reserve Bank of India's Monetary Policy Committee between February and June.

The housing financier's net profit is expected to rise also due to an expected fall in provisions by over 14% on quarter, according to Prabhudas Lilladher. The company's credit cost is also expected to decline by 4 basis points to 0.23%.

"Can Fin could likely post a strong performance with disbursements on guided track, some improvement in asset quality and margins benefiting from upfront funding cost reduction," YES Securities said.

Can Fin Homes is a deposit taking housing finance company, specialising in providing a range of housing loan products, including home loans, affordable home loans (often aligned with government schemes such as Pradhan Mantri Awas Yojna), composite loans for plot purchase and construction. Additionally, Can Fin offers non-housing financial products such as loans against property, loans for commercial premises, and site loans.

The company's loan book is estimated to grow around 9% on year, according to Motilal Oswal. The housing financier is likely to have stable-to-improving growth visibility and would continue to demonstrate relative resilience in asset quality, YES Securities said. "In terms of segments, we see scope for re-rating in Microfinance and Affordable Housing if asset quality trends hold-up in the near term," it said.

Of the 13 brokerage reports on the company available with Informist, 11 have a "buy" recommendation with an average target price of INR 916 and two have "hold" rating on the stock. At 1437 IST, shares of the company traded at INR 800, down nearly 1%, on the National Stock Exchange. The stock has fallen nearly 2% since the company announced its June quarter earnings.

Can Fin's net interest income in the June quarter was INR 10.1 billion, up 9% on year and its net profit was INR 2.24 billion, up 12% on year. The company will report its earnings for the September quarter Saturday.

Following are the Jul-Sept earnings estimates for Can Fin Homes Ltd. from five brokerage firms in descending order of the estimate of net profit:

End

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT

Edited by Akul Nishant Akhoury

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