Small-cap housing finance penny stock trading at Rs 50: Company partners with Tata Capital Housing Finance Ltd - know more here!

This penny stock has witnessed heavy buying as it has given multibagger returns of more than 158 per cent in just 3 years. 

Star Housing Finance Ltd (Star HFL) has partnered with Tata Capital Housing Finance Ltd (TCHFL) to provide affordable housing solutions. This collaboration aims to assist 5,000 home buyers in the economically weaker section (EWS) and low-income group (LIG) segment in its initial phase. Star HFL, known for its expertise in affordable housing finance, will utilize its branch network across Maharashtra, Madhya Pradesh, Gujarat, Rajasthan, NCR, and Tamil Nadu for this purpose. The agreement is expected to enhance Star HFL's asset under management (AUM) growth and further its mission in serving semi-urban and rural areas.

Management Commentary

Speaking on the occasion, Mr. Kalpesh Dave, CEO of Star HFL said, “We value this partnership with Tata Capital Housing Finance Limited. This partnership validates our journey and continued focus to create a quality loan book. We are happy that Tata Capital Housing Finance Limited trusted and validated our domain and capabilities to build a retail low-ticket home loan book. We aim to service 5000 families in our operational geographies in the first phase of 6-8 operational quarters and look forward to a long and mutually beneficial association”

Mr. Ashish Jain, MD of Star HFL said, “Happy to be entering into the co-lending partnership with Tata Capital Housing Finance Limited. I am confident that both teams will enrich through exchange of best practices across operational areas. There is an underserved segment of prospective home buyers who do not have formal credit access and therefore their home owning dreams remain unrealized. Through this partnership we look to further augment credit access for deserving customers in this addressable segment and at the same time build good quality loan book. Wish both teams good luck in this engagement and may this partnership prosper in times to come”

Financial Performance Highlights for the period of 9 months ending December 31, 2023.

• AUM: Increased to 368.67 crores by December 2023, up 96.54 per cent YoY.
• Disbursement: Reached 166.89 crores, up nearly 34 per cent YoY.
• Total Income: Stood at 42.29 crores, a 70.87 per cent YoY increase.
• Net Interest Income: Rose to 19.09 crores.
• Asset Quality: GNPA at 1.64 per cent and NNPA at 1.24 per cent as of December 31, 2023.
• Profit After Tax (PAT): Grew by 40.82 per cent YoY.
• Sanction & Disbursement: Received 203.42 crores in sanction, disbursed 148.42 crores, with 55 crores in undrawn limits.
• Borrowings: Stood at 266.49 crores, with a leverage of 2.05x.
• Funding Diversification: Successfully placed first NCD of 200 million. Plans to continue diversifying funding profile.
• Rating Upgrade: Upgraded from Care to BBB stable, reflecting growth and stability.

The shareholding pattern of this housing finance company is as follows: the public holding is maximum at 79.70 per cent where the promotor of the company holds 19.79 per cent of the stake and FIIs have 0.51 per cent shareholding.

On March 22, 2024, the stock surged more than 4 per cent to make an intraday high of Rs 51. The scrip witnessed some consolidation and closed at Rs 51. This penny stock has witnessed heavy buying as it has given multibagger returns of more than 158 per cent in just 3 years.

Investors should keep a close eye on this Small-Cap penny stock.

Disclaimer: The article is for informational purposes only and not investment advice.