CanFin Homes-A Housing Finance NBFC promoted by Canara Bank is coming out with a Rs 250-300 crore rights issue. The Board meeting to finalise the terms will be held on January 12, 2015. We expect a ratio of 1:2 and rights to be priced in the Rs 250-300 per share range, as against the current market price of Rs 600 per share.
The corporate lends essentially in Southern states, with loan ticket size of Rs 10-15 lakh. Post the Rs 250 crore fund raising, CanFin will be able to leverage the equity funds six times through debt, and will have additional disbursable sums of Rs 2000 crore. Consequently loan book by end FY15 will rise to Rs 8400 crore and to roughly Rs 10,000 crore by end FY16. EPS which is Rs 36 for FY 14 and possibly for FY15 will rise to Rs 60 by FY16-17 March. The stock is thus trading at a PE of 10, based on two year forward earnings of Rs 60 per share. At the current market cap of Rs 1000 crore, CanFin is the smallest housing finance NBFC. The business model is scalable. The three main shareholders of CanFin-Canara Bank, Chattisgarh Investments and NRN Murthy's Catamaran investments have already agreed to subscribe to their rights entitlement in full. The issue will thus sail through. Investors could play for the Bonus element in the rights issue, BUY the stock and BUY the rights. -- Kindly email stock reports at [email protected] For sharing knowledge -- NIFTYVIEWS.COM NOW A FREE OPEN SOURCE WEBSITE. http://www.niftyviews.com/ Disclaimer :- "The opinions expressed by the members on this board are based on their individual experience and perceptions and to share information with other members with the best of intentions to help fellow members in investment decisions as equity investment is a risky venture.The administrator of www.Niftyviews.com just provide a platform for the authors to express their opinion and take no guarantee for the genuineness of the same."ANY member of this forum doesnt prepare or publish any research report; or ii. provide research report; or iii. make 'buy/sell/hold' recommendation; or iv. give price target; --- You received this message because you are subscribed to the Google Groups "Niftyviews.com" group. To unsubscribe from this group and stop receiving emails from it, send an email to [email protected]. For more options, visit https://groups.google.com/d/optout.
