Futurecaps Clients Gain 30X from Mazagon Dock – What Lies Ahead?
Clients of Futurecaps benefited with huge returns – 30X on Mazagon Dock and 12X on Cochin Shipyard. What’s next? – Check out what’s coming up in our research pipeline.
Spotlight Pick – Can Fin Homes
Can Fin Homes is an established NBFC in the housing finance sector. It targets affordable housing borrowers, salaried buyers, and also provides financing solutions to businesses.
Its product portfolio includes: individual housing loans, affordable housing loans, credit-linked subsidy schemes, and Pradhan Mantri Awas Yojana (PMAY). It also extends services to businesses and individuals through varied loan types including site loans and top-up credit.
For individuals, Can Fin also offers personal loans, children’s education loans, loans for pensioners, as well as fixed and cumulative deposits.
The company operates in three key segments: Housing Finance, Non-housing Finance, and Deposits. The average loan ticket size is 18 lakh for housing and 9 lakh for non-housing credit. It also mobilizes both fixed and cumulative deposits as per NHB norms.
Headquartered in Bengaluru, Can Fin has a pan-India presence with 205 branches, 21 Affordable Housing Loan Centers, 12 satellite offices, and a total of 219 outlets across 100+ cities in 21 states and Union Territories. Shri Suresh S Iyer is the current Managing Director & CEO.
Core Offerings
• Housing Finance
• Non-Housing Finance
• Deposits
Positives
• 205 branches across 21 states and UTs, serving diverse geographies.
• Plans to expand network and penetrate new high-potential markets.
• Earnings CAGR of ~17.1% over the last 5 years.
• Intrinsic value estimated above 30%.
• Average borrowing cost at 6.5%, sustaining healthy spreads.
• Loan book crossed ?30,000 crore – strong business growth.
• 27% loan share from self-employed customers (?8,477 crore).
• Attractive valuation: P/E ~15X vs peer average ~24X.
• Better value than Indian diversified financial industry average (28.9X).
• Revenue forecasted at 14.7% growth vs Indian market 9.6%.
• Earnings growth forecast ~13.6%, higher than savings rate.
Challenges
• Intense competition from banks and larger HFCs in Tier I & free multibagger II cities.
• Credit risk due to borrower defaults.
• Macroeconomic factors like inflation, demand-supply, and interest rates can cause liquidity and funding risks.
Futurecaps Valuation Metrics
• Economic Moat – Moderate
• Growth – Good
• Valuation – Good
• Debt – High
• Integrity – Moderate
Summary
The company has the potential to deliver multibagger returns in the order of 300–500% over the next 5–10 years. Check our detailed research note for complete reasoning.
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