Can Fin's Growth Story Finds New Homes in the North

Synopsis The surge in Can Fin Homes' stock prices reflects its successful strategy to extend operations outside southern India. As the company spreads its wings, it expects a substantial increase in its asset management growth. Recent reports indicate a sharp rise in loan disbursements, backed by strong asset quality and controlled NPAs. The stock of Can Fin Homes has gained nearly 22% over the past three months. Of this, 10% gain was after it declared second quarter numbers on October 18. The BSE Financial Services index has gained over 9% in three months and 2% since October 18. The housing finance company is likely to improve AUM growth to over 15% in FY27 from the expected 12% for the current fiscal year aided by expansion in the Northern regions and a recovery in the existing southern markets. Can Fin opened 32 new branches in the September quarter taking the total number to 248 from the previous quarter. The housing lender is keen on improving presence beyond the southern states where it has a strong presence. In the September quarter, the proportion of the branches and loan portfolio in the South region of the country fell to 54% and 71% from 60% and 73% respectively in the year-ago quarter. This has helped the company to retain the momentum in the assets under management (AUM) notwithstanding the slower loan disbursement in the southern states of Karnataka and Telangana. "Beyond the key geographies, Can Fin continues to see strong growth in the eastern and northern states at upwards of 30%, while Tamil Nadu and western states have been delivering strong growth of 25%," noted Axis Securities in a report. Can Fin expects to improve the share of incremental disbursements in the northern region to 40% by the end of March 2028 from 32% at the end of September 2025. The company's disbursements increased by 26% year-on-year and 7% sequentially to ₹2,545 crore. The pace of growth may moderate in the December quarter owing to the technology transformation at the company level. However, this is likely to be short term in nature. Live Events The gross nonperforming asset (NPA) ratio remained below 1% in the September quarter helped by lower provisioning and easing delinquencies. "NPAs in the salaried portfolio fell sharply from ₹627 million to ₹372 million, indicating stronger repayment trends and better asset quality traction," mentioned Elara Capital in a report. The broking firm expects gross NPAs to hover within 0.9-1% in the near term. The net interest margin (NIM) expanded to 4% in the September quarter from 3.6% a year ago amid softening borrowing costs. Motilal Oswal Financial Services expects NIM to stay at around 4% for FY26. The broker has raised the FY26 earnings estimate by around 5% to factor in higher NIMs and lower credit costs. "We project an advances and net profit CAGR of around 13% each over FY25-28, with a return on assets of over 2.2%," the broker mentioned in a report, estimating ₹915 as the target price. The stock ended 0.6% lower at ₹886.4 on Thursday on the BSE. (You can now subscribe to our ETMarkets WhatsApp channel) (What's moving Sensex and Nifty Track latest market news, stock tips, Budget 2025, Share Market on Budget 2025 and expert advice, on ETMarkets. Also, ETMarkets.com is now on Telegram. For fastest news alerts on financial markets, investment strategies and stocks alerts, subscribe to our Telegram feeds .) Subscribe to ET Prime and read the Economic Times ePaper Online.and Sensex Today. Top Trending Stocks: SBI Share Price, Axis Bank Share Price, HDFC Bank Share Price, Infosys Share Price, Wipro Share Price, NTPC Share Price ...moreless Why Leyland and Iveco stand between Tata Motors and return to glory You bought IPOs of loss makers; check out what kind of companies are lining up How glitches-hit Air India is preparing for a take off India’s SIP boom has a hidden crisis: Are high dropout rates impacting wealth creation? Stock Radar: AB Capital stock in a sustained uptrend, hits fresh record high in November – time to buy or book profits? Weekly Top Picks: These stocks scored 10 on 10 on Stock Reports Plus 1 2 3