LIC Housing wins in valuation, but its asset quality a drag: Analysts

Lender's capitalisation may restrict growth and it's asset quality could be worse if a Supreme Court order is disregarded.

The LIC Housing stock has appreciated over 32 per cent in a year, but its valuation at 0.8x FY22 estimated book is still below its three-year average of 1.4x, making it an attractive value proposition.

However, the December quarter (Q3) was a mixed bag for the housing financier, and, hence, analyst recommendations/forecasts too are mixed. For instance, analysts at Motilal Oswal Financial Services and Emkay Global revised their FY22 estimated earnings upwards by 5 per cent and 14 per cent, respectively, while Kotak Institutional Equities reduced the FY22 earnings estimates by about 4 per cent, and ICICI Securities downgraded the