Loan & Finance

Hero Fincorp Ltd

₹ 765

*Average Price as per 3 July, 2022

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Fundamentals

FACE VALUE

10

BOOK VALUE

390.2

NO OF SHARES

127306672

EPS

4.22

SALES

340

INDUSTRY PE

55

DIVIDEND

1

DIVIDEND YIELD

0.1

PE

235.78

PB

2.55

PS

2.93

MARKET CAP

12667.01

ABOUT

Hero Fincorp Ltd. is a non-banking financial company (NBFC) engaged in extending retail finance for the two-wheeler sales of Hero Motor Corp. Ltd, bill discounting for Hero Motor Corp. Ltd's suppliers, loans to small and medium enterprises, loan against property (LAP), used car financing and personal loans. Moreover, Hero Fincorp Ltd’s subsidiary, Hero Housong Finance Ltd, received a housing finance licence from National Housing Bank (NHB) in August 2017. Hero Fincorp Ltd was incorporated in December 1991 under the name Hero Honda FinLease Limited. Following a change in the ownership of its parent, Hero MotoCorp Limited (formerly Hero Honda Motors Limited), the company changed its name to Hero Fincorp Limited in July 2011. Until April 2013, Hero Fincorp Ltd extended term loans, machinery loans, and bill discounting facilities primarily to entities within the HMCL ecosystem. It subsequently expanded its operations to entities outside the HMCL ecosystem and started extending loans for Hero Motor Corp. Ltd’s two-wheelers, used cars financing, personal loans, LAP, etc

OVERVIEW

On a consolidated basis, Hero FinCorp Ltd. reported a PAT of Rs. 278 crore on a total asset base of Rs. 28,092 crore in FY2020 against a PAT of Rs. 246 crore on a total asset base of Rs. 21,551 crore in FY2019. In H1 FY2021, the company achieved a PAT of Rs. 109 crore on a total asset base of Rs. 28,187 crore. As on September 30, 2020, the company’s consolidated loan portfolio comprised two-wheeler finance with a portfolio share of 34%, dealer inventory funding (2%), pre-owned car finance (7%), personal loans (9%), home loans (6%), retail SME loans (22%), and corporate loans (20%).

Given the Covid-19-induced disruption and the resultant slowdown in the economy, alike broader industry, Hero FinCorp Ltd’s portfolio is likely to be vulnerable. While the reported gross and net stage 3 ratios, at the consolidated level, improved to 5.5% and 3.3%, respectively, as on September 30, 2020, from 6.1% and 3.8%, respectively, as on March 31, 2020, it is noted that forward bucket movements were curtailed in H1 FY2021 by the prolonged forbearance period

INSIGHTS


FINANCIALS

Half Yearly 6 Month Ended as on Sept 30, 2021