LICHSGFIN - LIC Housing Fin.

📊 NSE: LICHSGFIN 🏢 Finance - Housing 📅 Last Updated: 12/14/2025 9:15

💰 Financial Performance

Revenue Growth by Segment

Total revenue for FY 2024-25 reached INR 28,056.22 Cr, representing a 3.02% increase from INR 27,234.64 Cr in the previous year. The primary segment is Housing Finance, which constitutes the principal revenue source. Retail business showed a 24% quarter-on-quarter growth from Q1 to Q2 FY2026.

Geographic Revenue Split

Not disclosed in available documents, though the company maintains an extensive geographical presence across India to support its INR 3,09,587 Cr AUM.

Profitability Margins

Net Interest Margin (NIM) stood at 2.62% in Q2 FY2026, a slight decline from 2.71% in Q2 FY2025. Return on Average Managed Assets (AMA) was 1.8% for FY2025 and 1.7% for Q1 FY2025. Return on Average Net Worth (RONW) was 16.0% in FY2025, compared to 16.3% in FY2024.

EBITDA Margin

Profit Before Tax (PBT) for Q2 FY2026 was INR 1,704.71 Cr, up 0.32% from Q1 FY2026. Profit After Tax (PAT) for Q2 FY2026 was INR 1,353.87 Cr, a 2% increase YoY. Core profitability is impacted by competitive pricing pressures in the salaried home loan segment.

Capital Expenditure

Not disclosed in available documents; however, the company focuses on IT infrastructure and digital transformation to manage its INR 3,09,587 Cr loan book.

Credit Rating & Borrowing

The company maintains a strong credit profile supported by its parent, LIC. It raises funds through NCDs, Commercial Paper (CP), and NHB lines. Gearing levels improved to 7.4 times as of June 30, 2025, down from 8.2 times in March 2024.

⚙️ Operational Drivers

Raw Materials

The primary 'raw material' is capital/debt, comprising Bank Loans, Non-Convertible Debentures (NCDs), Commercial Paper, and Public Deposits. Interest expense is the largest cost component.

Import Sources

Domestic financial markets including public and private sector banks, insurance companies, mutual funds, and pension funds.

Key Suppliers

Key lenders and funding providers include LIC (parent), National Housing Bank (NHB), and various public and private sector banks.

Capacity Expansion

Current AUM is INR 3,09,587 Cr as of June 30, 2025. The company aims to increase the business contribution from its subsidiary, LICHFL Financial Services (FSL), from the current 10% to 25% in the coming year.

Raw Material Costs

Cost of funds is managed through a diversified borrowing base. Interest rate risk exists as assets are primarily floating rate while a higher share of liabilities is fixed rate.

Manufacturing Efficiency

Operational efficiency is measured by Net Profit per employee, which stood at INR 2.14 Cr in FY2025.

Logistics & Distribution

Distribution is handled through an extensive branch network and the LIC agency network, which aids in brand sharing and low-cost sourcing.

📈 Strategic Growth

Expected Growth Rate

10%

Growth Strategy

The company plans to achieve 10% growth in disbursements and loan book by leveraging its subsidiary LICHFL FSL (targeting 25% business contribution) and focusing on the high-productivity Q3 and Q4 quarters. It prioritizes profitability over aggressive growth to maintain margins.

Products & Services

Individual home loans (primarily to the salaried segment), construction finance, developer loans, and insurance distribution services.

Brand Portfolio

LIC Housing Finance Limited (LICHFL).

New Products/Services

Expansion of insurance distribution (general and life) through the FSL subsidiary to increase fee-based income.

Market Expansion

Strengthening the FSL channel by increasing marketing force and recruitment to capture a larger share of the retail housing market.

Market Share & Ranking

LICHFL is the largest Housing Finance Company (HFC) in India with an AUM of INR 3,09,587 Cr.

Strategic Alliances

Strong parentage linkage with LIC (45.2% stake) providing operational, financial, and branding support.

🌍 External Factors

Industry Trends

The HFC industry is seeing increased competition from banks. LICHFL is positioning itself by maintaining a Liquidity Coverage Ratio (LCR) of 177%, well above the 85% regulatory requirement, to ensure stability during market volatility.

Competitive Landscape

Faces intense competition from large commercial banks and other leading HFCs, particularly for high-quality salaried borrowers.

Competitive Moat

Moat is derived from the 'LIC' brand and a massive distribution network. This provides a sustainable cost-of-funds advantage and trust in the retail segment, though it is challenged by aggressive bank pricing.

Macro Economic Sensitivity

Sensitive to interest rate cycles and urbanisation trends. Rapid urbanisation and government incentives for housing drive demand for home loans.

Consumer Behavior

Shift toward nuclear families and increasing societal acceptance of credit are driving long-term demand for housing finance.

Geopolitical Risks

Low direct impact; however, indirect risks include macro-economic shifts affecting interest rates and government borrowing.

⚖️ Regulatory & Governance

Industry Regulations

Regulated by the Reserve Bank of India (RBI) with supervisory oversight by the National Housing Bank (NHB). Must maintain specific LCR and Capital Adequacy (CRAR) thresholds.

Environmental Compliance

Direct environmental risk is low due to the service-oriented model. ESG monitoring focuses on indirect credit risk from environmentally sensitive segments.

Taxation Policy Impact

Complies with Indian Accounting Standards (Ind AS) and Section 133 of the Companies Act, 2013.

Legal Contingencies

The company manages legal risks through a dedicated team for title verification. Specific values for pending court cases are not disclosed, but the company focuses on minimizing customer complaints to reduce legal exposure.

⚠️ Risk Analysis

Key Uncertainties

Asset quality in the wholesale segment (GS3 at ~25%) and potential slippages from the INR 1,833 Cr restructured loan pool represent key financial uncertainties.