Repco Home Finance (REPCOHOME) Q4 07/08 earnings summary

Executive summary

• FY 2007-08 business growth exceeded 48%, with net profit up more than 35%; net NPA was 0.86%.

• Loan outstanding reached Rs 655.08 crore, supported by rapid lending growth and a Rs 75.94 crore first Carlyle investment tranche.

Financial highlights

• Income from operations was Rs 68.87 crore and total income Rs 71.39 crore, versus Rs 43.80 crore and Rs 44.37 crore, respectively, in FY 2006-07.

• PBT rose to Rs 21.45 crore from Rs 14.44 crore; PAT increased to Rs 15.57 crore from Rs 11.53 crore.

• Loan sanctions were Rs 294.73 crore, disbursements Rs 275.58 crore and year-end outstanding loans Rs 655.08 crore, each growing more than 48% YoY.

• Other income included Rs 1.49 crore profit on sale of investments; this was a non-operating contribution to reported earnings.

Outlook and guidance

• Targeting more than 50% portfolio growth in FY 2008-09, with commensurate profitability growth and GNPA below 1%.

• Long-term target: Rs 2,500 crore outstanding loan portfolio by 2011; plans include 11 new branches in FY 2008-09 and expansion beyond the southern states.

• Plans to launch public deposit schemes in FY 2008-09 and establish Repco Infrastructure Development Co. for infrastructure and PPP financing.

• Cheaper funding is a priority to support lower lending rates; a web-based centralized software system was planned before September 2008.