Star Housing Finance Limited also experienced a stiff rise in its share price after the release of Q1 results for the financial year 2024. The stock gaped up at ₹52 and touched an intraday high of ₹54.97 each after the bell rang for the opening of the stock markets. The intraday increase was approximately 9%. However, profit-booking brought a dip and the stock came down to an intraday low of ₹50.51 per share. At the moment, the share price of Star Housing Finance is about ₹52 per share.
Image Source: Star Housing Finance
Vision and Mission of Star Housing Finance
Star Housing Finance Limited intends to bring a change in the lives of first-time home buyers from the EWS & LIG section. To help people to feel the comfort of their “own house” – to provide good-looking and high-quality financial products. To be an organization where the principle of personal attention never becomes a thing of the past. Organizations seek to hire people who are very happy and always offer their best to clients. Star Housing Finance aims to promote homeownership by simplifying the procedures and providing convenient solutions for EWS and LIG clients.
Business Growth and Asset Quality
Assets Under Management (AUM) rose by a remarkable 73.55% year on year (YoY), up to INR 471.41 crore. The company disbursed ₹61.23 crore during the quarter ended on June 2024. PAR (0+ days past due) was 3.38% at the end of the period, Gross Non-Performing Assets (GNPA) at 1.57%, and Net Non-Performing Assets (NNPA) at 1.12% as of June 30, 2024.
Income and Liability
Interest income rose by 61.43% YoY on the back of higher traction in the disbursements segment. Net Interest Margin (NIM) has remained at 7.04%. The Profit Before Tax (PAT) has risen by 87.98% YoY. Star Housing Finance has sound relations with various banks and financial institutions to facilitate the expansion of the loan book. The business enhanced its key lending offerings for effective home loan origination and collection.
Challenges Faced by Star Housing Finance
Star Housing Finance Limited has recorded impressive financial results for the first quarter of the financial year 2024 with better improvement in indicators like PAT and Net Sales. Other income for the company for the quarter is 52.43% of its Profit Before Tax (PBT). This leads to a questioning of the sustainability of its business model. There is a higher financial risk as Star Housing Finance’s debt-to-equity ratio has improved. As with most of the housing finance companies in India, Star Housing Finance may experience problems non-availability of long-term funds for financing its investments. These issues need to be considered by investors before making any investment decision. Although the prospects of the company demonstrate improvement, knowledge of the risks involved is crucial in making decisions.
Conclusion
The company’s business performance and growth trends point towards a rosy future for Star Housing Finance sources. They should also closely watch its further evolution. The organization stated its intention to double the dividend, which is, however, dependent on the approval of the shareholders in the next AGM.
