Indiabulls Housing Finance: Banking licence key after June quarter blip

Gross NPA ratio slips to 1.47%, worst in five years; incremental cost of funds escalate to 9.2%

Having weathered the liquidity crisis well till a quarter ago, expectations were high from India’s third largest housing financier – Indiabulls Housing Finance (Indiabulls). June quarter (Q1) though was a let-down. Headline growth numbers such a net interest income (NII) and net profit came at Rs 1,475 crore and Rs 802 crore, significantly trailing expectations. These numbers were lower than the year ago levels by 12.7 per cent and 24 per cent, respectively.

Q1 numbers also point to two important factors–weakening asset quality and higher cost of funds. With both being the key ingredients to loan growth, even the latter