1. At a Glance
PNB Housing just clocked ₹533 Cr profit in Q1 FY26 and brought Gross NPA down to 1.06%. What was once a Babu-bank subsidiary punching below its weight is now quietly becoming a retail-loan terminator with a 34% financing margin.
2. Introduction with Hook
Remember when PNB Housing was the stepchild of Punjab National Bank’s family reunion? Lost in a sea of NPAs, regulatory hurdles, and promoter exits?
Well…
Q1 FY26 just flipped the script.
- PAT up 23% YoY to ₹533 Cr
- Retail Loan Book up 18% YoY
- Gross NPA down to 1.06% (from 3.83% two years ago)
It’s like watching a Delhi Metro coach outrun an Indian Railways mail train.
3. Business Model (WTF Do They Even Do?)
PNB Housing is a housing finance company, which means they fund dreams… with 9% interest and 10-year EMIs.
Core offerings:
- Home Loans (construction, purchase, renovation)
- Loan Against Property
- Residential Plot Loans
- Non-resident Loans
- Commercial Property Loans
Focus: High-ticket salaried & self-employed customers in urban India.
Basically, not your “chhoti dukaan + EMI” guy. This is more HNI-heavy than street-level finance.
4. Financials Overview
| Metric | Q1 FY25 | Q1 FY26 | Growth YoY |
|---|---|---|---|
| Revenue | ₹2063.9 Cr | ₹2,064 Cr | +0.04% |
| Net Interest Income | ₹~575 Cr | ₹693 Cr | +20% est. |
| Net Profit | ₹431 Cr | ₹533 Cr | +23% |
| Gross NPA | 1.08% | 1.06% | Improved |
| Net NPA | 0.69% | 0.69% | Flat |
Margins improving, loan book expanding, NPAs down. If this were cricket, that’s a well-paced fifty in tough pitch conditions.
5. Valuation
- CMP: ₹1,084
- TTM EPS: ₹78.55
- P/E: ~13.8x
- Book Value: ₹648
- P/B: 1.67x
Fair Value Range Estimate
| Method | Fair Value Range (₹) |
|---|---|
| P/E Based (15x–18x) | ₹1,180 – ₹1,415 |
| P/B Based (1.6x–2x) | ₹1,040 – ₹1,296 |
| GNPA-Based Re-rating | ₹1,200 – ₹1,400 |
Conclusion: Near fair value with mild upside. Needs catalyst (dividend, buyback, PE exit?) for breakout.
6. What’s Cooking – News, Triggers, Drama
- Q1 FY26 Concall: PAT up 23%, GNPA lowest in 5 years
- Retail Book Surge: 18% YoY growth
- Margins 🔥: Financing margin at 34%
- Asset Quality: From 6.35% GNPA (Jun ’22) → 1.06% (Jun ’25)
- No Dividend Yet: Despite healthy profits
Also: Promoter holding dropped below 30%, FIIs & DIIs picked up the slack. PE players possibly eyeing a partial exit.
7. Balance Sheet
| FY End (₹ Cr) | FY23 | FY24 | FY25 |
|---|---|---|---|
| Equity Capital | ₹169 Cr | ₹260 Cr | ₹260 Cr |
| Reserves | ₹10,784 | ₹14,673 | ₹16,574 |
| Borrowings | ₹53,621 | ₹55,017 | ₹62,360 |
| Total Assets | ₹66,805 | ₹72,371 | ₹82,497 |
Highlights:
- Leverage up = Expansion mode
- Reserves doubling in 2 years = Strong profit retention
- Net worth now ~₹16,834 Cr
8. Cash Flow – Sab Number Game Hai
| Year | CFO | CFI | CFF | Net Cash |
|---|---|---|---|---|
| FY23 | ₹-1,772 Cr | ₹174 Cr | ₹301 Cr | ₹-1,297 Cr |
| FY24 | ₹-4,644 Cr | ₹-1,193 Cr | ₹4,179 Cr | ₹-1,659 Cr |
| FY25 | ₹-8,120 Cr | ₹757 Cr | ₹7,404 Cr | ₹41 Cr |
Big negative operating cash = aggressive disbursements
But financing keeps balancing the books. Standard for HFCs.
9. Ratios – Sexy or Stressy?
| Ratio | FY23 | FY24 | FY25 |
|---|---|---|---|
| ROE | 10% | 12% | 12% |
| ROA | ~1.7% | ~2.5% | ~2.5% |
| GNPA | 3.83% | 1.08% | 1.06% |
| NIM | ~3.5% | ~3.9% | ~4.2% |
Verdict: Asset quality has seen a massive glow-up. ROE improving, but still room to go before “premium valuation” territory.
10. P&L Breakdown – Show Me the Money
| Year | Revenue | Net Profit | EPS |
|---|---|---|---|
| FY23 | ₹6,491 Cr | ₹1,056 Cr | ₹40.70 |
| FY24 | ₹7,014 Cr | ₹1,527 Cr | ₹58.81 |
| FY25 | ₹7,633 Cr | ₹1,949 Cr | ₹74.98 |
| TTM | ₹7,884 Cr | ₹2,042 Cr | ₹78.55 |
Growth:
EPS nearly doubled in 2 years. Revenue growing slowly, but margins are exploding = classic efficiency play.
11. Peer Comparison
| Company | P/E | ROE (%) | GNPA (%) | CMP / BV | MCap (Cr) |
|---|---|---|---|---|---|
| PNB Housing | 13.8 | 12.27 | 1.06 | 1.67 | ₹28,212 |
| LIC Housing | 6.3 | 16.05 | ~2.3 | 0.94 | ₹34,318 |
| Aavas Financiers | 26.6 | 14.12 | ~0.7 | 3.50 | ₹15,267 |
| Home First Fin. | 37.1 | 16.46 | ~1.0 | 4.91 | ₹14,204 |
Verdict:
PNB Housing = Value play in a growth-heavy sector.
Peers get premium for tech, low GNPA & fintech glam.
PNB Housing = high PAT, low jazz.
12. Miscellaneous – Shareholding, Promoters
| Category | Jun 2025 |
|---|---|
| Promoters | 28.08% |
| FIIs | 24.18% |
| DIIs | 37.99% |
| Public | 9.74% |
Trends:
- DIIs now hold 38%, vs 7.6% a year ago
- Promoter stake down from 32.5% → 28%
- Public participation thinning → institutionalized stock now
13. EduInvesting Verdict™
PNB Housing just dropped its best quarter in years and keeps marching toward a cleaner, leaner model. There’s no fintech flashiness or flashy founder tweets, just pure housing loan muscle.
- What We Like:
- Consistent PAT growth
- GNPA = best in class
- High financing margin
- DII/FII confidence
- But…
- Promoter stake declining
- Still lags top-tier names in valuation
- No big dividend or buyback yet
If this housing stock were a house—solid brickwork, not flashy, but you’ll sleep well at night.
Metadata
– Written by EduInvesting Team | 21 July 2025
– Tags: PNB Housing Finance, Q1 FY26, Housing Finance, GNPA Downtrend, Retail Loan Growth, EPS Growth
