LIC Housing Finance (LICHF IN) – Q3FY26 Result Update – Muted growth; NIM to moderate – Downgrade to ‘Accumulate’
Published on 02 Feb 2026
Q3 disbursements were muted (+4% YoY) due to intense competition from banks. Consequently, the loan book grew 5% YoY, and we expect it to remain in a range of 6-7% in FY26/ FY27E. LICHF has taken a PLR cut in Dec-25 to curb BT-out pressure. We expect NIM (calc) to moderate to 2.4% by FY28E due to lower incremental yield. Headline asset quality saw an improvement, and we build in a credit cost of ~20bps over FY26-28E. We cut our FY26/ FY27E estimates factoring in lower growth and margins. We cut our Dec-27E P/ABV to 0.7x (vs. 0.8x earlier), resulting in TP of Rs 525. Downgrade to ‘Accumulate’.
