Finance
Aadhar Housing Finance share price jumps 8% after flat debut. Buy, sell or hold?
Aadhar Housing Finance, a unique retail-oriented home finance company, stands out with its specialization in low-income housing. Today, its shares had a flat listing on the Indian exchanges. Aadhar Housing Finance shares were listed on BSE at ₹314.30 per share mark while the stock listed on NSE at ₹315 apiece, which was almost at par with the upper price band of ₹315 per equity share of the Aadhar Housing Finance IPO. However, the newly listed stock witnessed strong buying post-listing and touched intraday high of ₹341.95 apiece on BSE and NSE. Stock market experts believe that the newly listed stock is a good portfolio stock, and positional investors can hold the stock for the long term.
Aadhar Housing Finance share price outlook
Discussing the listing of Aadhar Housing Finance shares, Prashanth Tapse, Senior VP — Research at Mehta Equities, expressed, “Despite the subdued market conditions, Aadhar Housing Finance’s listing was slightly below street expectations. The company’s focus on the rapidly growing low-income housing segment, which is projected to be the fastest sub-segment within the housing finance industry, has garnered a decent subscription demand. With its reasonable valuations, it presents a promising long-term investment opportunity for conservative investors.”
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With a positive outlook for the affordable low-income housing segment, driven by government initiatives such as housing for all and infrastructure status for affordable housing, Aadhar Housing Finance is well-positioned for growth. Its reasonably priced ask valuations compared to industry peers, growing Gross AUM and Net Worth, stable average ticket size of loans, and increasing penetration into tier 4 and tier 5 towns all indicate sound financial health and potential for further expansion. Given the long-term optimistic sector outlook, we recommend allotting investors to “HOLD” for a long-term perspective,” a Mehta Equities expert said.
Reiterating the company’s specialization in low-income housing, Amit Goel, Co-Founder & Chief Global Strategist at Pace 360, stated, “Aadhar Home Finance Ltd. is a retail-oriented home finance company that excels in serving the low-income housing market. It caters to economically weaker consumers with middle-to-low incomes who require small-ticket mortgage loans. Offering a range of mortgage-related loan products, such as loans for acquiring and constructing commercial real estate, home remodelling and extension loans, and loans for purchasing and constructing residential real estate, the company is well-positioned for future growth. We advise investors to consider this potential and hold their investments for medium to long-term rewards.”
“On the financial front, Aadhar Housing Finance reported the second-highest return on equity in FY23 at 15.9%. As we advance, we expect operational performance to improve, led by the dominant low-income housing segment, low cost of borrowing, and higher return ratio among peers. We thus advise investors who have received allotment to hold shares from a medium to long-term perspective,” said Shreyansh Shah, Research Analyst at StoxBox.
Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before making any investment decisions.
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Published: 15 May 2024, 11:53 AM IST