PNB Housing: Navigating Growth and Challenges in India's Lending Market

PNB Housing has shown a profit boost of 8% in the last quarter of 2023, but the road ahead is not all smooth. The company made a net profit of 5. 20 billion rupees, up from 4. 83 billion rupees a year before. Revenue also saw a 9% increase, reaching 21. 19 billion rupees. This growth is partly due to the company's push into non-premium and affordable lending, where interest rates are higher and competition is lower. However, this advantage might not last. Big banks are starting to show more interest in the affordable lending market, which could mean tougher competition for PNB Housing. At the same time, the prime segment, which includes loans in bigger cities, is already facing strong competition.PNB Housing's strategy to expand into smaller cities is paying off, with a 25% increase in disbursements in this segment. But the affordable loans segment, which targets lower-income borrowers, saw a 15% decrease in disbursements. The company blamed this on loan size limits in certain areas. On the bright side, PNB Housing's net interest income went up by 11%, and the quality of its assets improved. The percentage of bad loans dropped to 1. 04% from 1. 21% a year earlier.