PNB Housing IPO begins tomorrow
State-run bank PNB is ready to unlock value by selling a stake in its home finance subsidiary, PNB Housing Finance though an initial public offering (IPO) that opens on Tuesday. The home finance company has set the price band for the IPO at Rs 750-775 apiece, valuing it at close to Rs 13,000 crore. Here’s what different brokerages say about the IPO: KRChoksey: Short-term challenges persist, but valuation attractive “The current augmentation of capital base and widening distribution network should help the company maintain 20 per cent annual business growth in the coming days. Moreover, stable asset quality over the years and notably the 76 per cent the book being less than two-year tenure might not trigger any negative surprises,” the brokerage said. Motilal Oswal: ROE low, but growth in assets race ahead of peers “Though the company's 17.6 per cent ROE is lower than the average of 22.4 per cent for industry peers, the growth in AUM has been significantly higher (62 per cent against 20-25 per cent for industry). The valuation is at a reasonable discount to its peers, when considered on the post-issue book value,” the brokerage said.
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