LIC Housing Finance Limited

Financial Services — Mortgage Finance · NSE

₹521.00−₹12.20 (−2.29%)

DalalBaazaar Score

81 / 100

🟢 Strong

Verdict

ATTRACTIVE

Risk

Low

Driven by negative free cash flow.

In simple words: Reasonable but unspectacular business quality, with modest growth. Cash generation is currently the main factor to watch.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 7:47 pm

Understanding the Business

Company site ↗

The 60-second version of LIC Housing Finance Limited — what it does, how it earns, and who it competes with, before any of the numbers below.

What does this company do?

LIC Housing Finance Limited, a housing finance company, provides loans for the purchase, construction, repair, and renovation of houses/buildings in India.

IndustryMortgage Finance

SectorFinancial Services

Employees2,384

Annual revenue₹8,550 Cr

How does it make money?

Turns over ₹8,550 Cr a year. Of every ₹100 of sales, about ₹66 reaches shareholders as profit. Each of its 2,384 employees supports ₹3.59 Cr of revenue a year, the signature of a capital- or asset-led business.

Revenue / employee₹3.59 Cr

Who are its competitors?

The closest listed comparisons in its industry are BAJAJ FINANCE LIMITED, HDFC BANK LTD, ICICI BANK LTD., STATE BANK OF INDIA. These are the companies its valuation and returns are measured against elsewhere in this report.

Compared side by side in Peers ↓

What is its competitive advantage?Not assessable from these ratios

For a lender, returns on capital are shaped by leverage and funding cost rather than by pricing power, so the usual financial signature of an advantage does not apply. Judge this one on deposit franchise, cost of funds and asset quality — none of which are in this data.

Peer median ROE16.5%

What is the outlook?

24 analysts covering the stock expect revenue to grow about 8.1% and earnings to grow about 5.8% in the year to 2028. These are estimates by people who follow the company, not a forecast for the wider industry.

Est. revenue growth+8.1%

Est. earnings growth+5.8%

Analysts24

What has been driving growth?

Sales and margins have both contributed to where profit is now. Over 3 years revenue moved +34% while net margin moved +45% relative to itself. What this cannot tell you is which products, customers or geographies did the work — that lives in the segment disclosures of the annual report.

Revenue effect+34%

Margin effect+45%

DalalBaazaar Score

81/ 100

Strong

Weighted across six categories. Every point is explained below.

✓ Beta of 0.25 — historically steadier than the index
✗ Negative free cash flow means dependence on external funding

Quality vs. Valuation

Company Quality

83/ 100

Excellent

How good the business is, ignoring the share price entirely.

Valuation

88/ 100

Cheap

What you are being asked to pay, ignoring how good the business is.

A good business currently available at an undemanding price — the combination this framework is built to look for.

Historical Valuation

Current P/E

5.0x

3Y Median

6.9x

40 monthly readings · mean 7.7x · range 5.0x–15.2x

Sector Median

17.0x

median of 4 sector peers

🟢Current valuation is approximately 28% below its 3y median of 6.9x. Cheaper than its own history, which is worth a reason too: the market may be pricing in something the backward-looking numbers do not show.

🟢Against its sector it trades 71% below the peer median of 17.0x.

vs. its own history

Cheap

6.9x median over 40 months · -28%

vs. sector peers

Cheap

17.0x median of 4 peers · -71%

vs. generic bands

Cheap

Below 15x

EV/EBITDA

—

PEG

0.20

What's Good / What's Bad

🟢 What's Going Well1

Consistently profitable
Profitable in every one of the last 4 reported years.

🔴 What Needs Attention0

Nothing stands out as clearly deteriorating on the years of data available.

Red Flags

1 item require attention · 1 watch

🟡Low reported insider holdingOwnership
Reported insider holding is 2.3%. For Indian companies this field is an unreliable proxy — check the official promoter shareholding in the exchange filing.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Priced below its own history
The stock trades 28% below its own median multiple. If the business performs as it has and simply re-rates back to normal, that gap is return on its own.
Cheaper than its peers
It trades 71% below the sector median. Either the market sees a problem the numbers do not show, or the discount closes.
Earnings have proved durable
Profitable in every one of the last 4 reported years. Consistency lowers the risk that any single bad year is structural rather than cyclical.

🔴 Bear CaseWhat could go wrong?

No clear risk case emerges from the available numbers — which is not the same as there being none.

🟡 Key Things to WatchMeasurable tripwires, set against where this company stands today

1Revenue growth stays above 8% a year✓ 10.3% CAGR
Latest reported year was 14.5%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
2Return on equity stays above 12%✓ 13.5%
For a lender this is the cleanest single read on whether the book is being grown profitably.
3Valuation vs its own median of 6.9x✓ 5.0x today
A re-rating above its own history needs a reason; without one it is just a higher price.

Investment Checklist

7 / 10 checks passed

✗ Strong return on equity (ROE ≥ 15%)
✓ Healthy net margin (≥ 10%)
✗ Generates positive free cash flow
✗ Manageable leverage (Debt/Equity < 1.0)
✓ Revenue growing year-over-year
✓ Profit growing year-over-year
✓ Not trading at an extreme valuation (P/E < 40x)
✓ Not buying right at the 52-week high
✓ Analyst consensus isn't majority-sell
✓ Short-term technical trend isn't bearish

Price history

Quick Metrics

4 good · 5 neutral · 2 weak

Market Cap

₹28,658 Cr

Mid Cap

Mid-sized — more growth headroom, but sharper swings than large caps

P/E (Trailing)

5.0x

Cheap

Cheap against the generic band

P/B Ratio

0.69x

Reasonable

Reasonable against the company's book value

EPS (TTM)

₹104.33

Profitable

Profitable on a per-share basis

ROE

13.5%

Moderate

Moderate capital efficiency

ROCE

Not meaningful

N/A for lenders

Banks and NBFCs don't report capital employed the way other businesses do

Debt/Equity

6.43x

High

High leverage

Revenue Growth (YoY)

14.5%

Healthy

Healthy top-line growth

Profit Growth (YoY)

9.9%

Modest

Slow profit growth

Dividend Yield

1.92%

Modest

Small cash return — most of the return has to come from the price

Free Cash Flow

-₹8,556 Cr

Cash burning

Spending more cash than the operations bring in

More Metrics

P/E (Forward)

4.8x

Improving

Below the trailing multiple — the street expects earnings to grow into the price

Operating Margin

82.4%

Good

Healthy core-business profitability

Net Margin

65.2%

Good

Strong bottom-line conversion

Beta (vs Nifty)

0.25

Defensive

Steadier than the market

52W Range Position

45%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

543.4 / 532.5

Bullish alignment (short > long)

Price vs SMA 200

Below

Long-term downtrend

RSI (14)

37.3

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹6,380 Cr	₹8,677 Cr	₹8,179 Cr	₹8,550 Cr	+10.3%
PAT (Net Profit)	₹2,891 Cr	₹4,763 Cr	₹5,442 Cr	₹5,604 Cr	+24.7%
EPS	₹52.55	₹86.53	₹98.95	₹101.87	+24.7%
ROE	10.6%	15.1%	15.0%	13.5%	—
Total Debt	₹2.34 L Cr	₹2.43 L Cr	₹2.63 L Cr	₹2.66 L Cr	+4.4%
Free Cash Flow	-₹19,696 Cr	-₹7,189 Cr	-₹17,051 Cr	-₹8,556 Cr	—

🟢 Revenue has grown at 10.3% a year over 3 years.

🟢 PAT (Net Profit) has grown at 24.7% a year over 3 years.

🟢 EPS has grown at 24.7% a year over 3 years.

🟢 ROE has risen from 10.6% to 13.5% over 3 years (+2.9 pts).

🔴 Total Debt has grown at 4.4% a year over 3 years.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹3.25 L Cr

Total Liabilities

₹2.84 L Cr

Cash & Equivalents

₹932 Cr

Operating Cash Flow

-₹8,504 Cr

Capex

-₹52 Cr

Shareholding (proxy)

Institutional Holding

75.7%

Insider Holding

2.3%

Corporate Actions

Next Earnings

28 Oct 2026

Dividend Rate

₹10

Ex-Dividend Date

21 Aug 2026

Analyst Consensus

Recommendations

14 Buy · 7 Hold · 4 Sell

Target Price (Mean)

₹588.24

+12.9% vs CMP

Target Range

₹440 – ₹710

Peer Comparison

Company	P/E	ROE
BAJAJ FINANCE LIMITED	30.2x	17.8%
HDFC BANK LTD	15.9x	13.8%
ICICI BANK LTD.	18.1x	16.5%
STATE BANK OF INDIA	10.3x	15.2%

Recent News

6 general

Vedanta, PFC to LIC Housing: THESE 5 Stocks Look Surprisingly Cheap on Valuation | Full List

Goodreturns, 15 Oct

LIC Housing Finance Share Price and Technical Outlook

Kalkine India, 14 Oct

LIC Housing Finance Sees Sharp Open Interest Surge Amid Mixed Price Action

MarketsMojo, 18 Oct

LIC Housing Finance among 4 F&O stocks with a sharp rise in futures open interest

The Economic Times, 15 Oct

LICHSGFIN Outlook for the Week

Equitypandit, 09 Oct

Is LIC Housing Finance the Best Stock in Its Sector? A Look at the Numbers

Univest, 13 Oct

Watch Items

This is a financial-sector business: borrowing is its raw material, not leverage in the usual sense. Debt/Equity and ROCE here aren't comparable to a manufacturer's — read them alongside NIM, GNPA and capital adequacy from the company's own disclosures.
Cross-check against the company's latest quarterly filing / investor presentation before acting.
Reported insider holding is low — cross-check the official promoter shareholding % in the company's exchange filing.

DalalBaazaar Thesis

StrongBusiness Quality · Financial Health · Growth · Profitability · Valuation

MiddlingRisk

Points for each in the Score ↑

Attractive on both counts

A good business currently available at an undemanding price — the combination this framework exists to look for. The work left is qualitative: whether the advantage the numbers imply is one you can identify and expect to last.

All 3 tripwires holding · see Key things to watch ↑