Bank CEOs meet with Trump to discuss Fannie Mae and Freddie Mac - Bloomberg
On Tuesday, HSBC analyst Rahil Shah changed the rating for LIC Housing Finance (NSE:LICH) (LICHF:IN) from Reduce to Hold and increased the price target from INR550.00 to INR600.00. Shah’s decision came after recognizing an improvement in the company’s earnings growth outlook, despite a near 19% drop in the stock’s price since August 24, 2024, due to weak earnings per share (EPS) growth.
The analyst cited the earnings upgrade as the reason for the increased target price, now set at INR600, which reflects 0.8 times the forecasted FY26 book value per share. Shah noted that although there has been a slight improvement in the earnings growth outlook, the target valuation is considered fair and suggests limited upside from the current prices according to HSBC’s rating matrix.
The upgrade to Hold indicates that HSBC believes LIC Housing Finance lacks further re-rating catalysts at this time. Shah mentioned that there are risks and opportunities that could affect the stock’s performance. On the upside, a sharp increase in loan growth or net interest margin (NIM) expansion could positively impact the stock’s valuation. Conversely, the stock could face downside risks from a sharp NIM compression due to a repo rate cut, competitive pressure, and a slowdown in the developer finance (DF) segment.
Investors in LIC Housing Finance are now observing the stock following the updated guidance from HSBC. The new price target represents HSBC’s adjusted expectation for the stock’s potential performance, taking into account recent market movements and the company’s financial outlook.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.