PNB Housing Finance Targets Sustained Growth Strong Margins

Ashwin Thakker

— 2 min read

Key Facts on Outlook:

  • Retail Loan Book Growth: Guided at 18% for current fiscal year; target of 18-19% growth on book.
  • Affordable Housing Book: Target of Rs. 9,500 crore (near-term) and Rs. 15,000 crore by March 2027.
  • Overall Retail Book: Aiming for Rs. 1 lakh crore by March 2027.
  • Net Interest Margin (NIM): Full-year guidance maintained at 3.65% to 3.7%, with potential for slight inching up next year.
  • Credit Costs: Confident of closing the year with negative credit cost.
  • Asset Quality: Gross NPA at 1.06% and Net NPA at 0.69% as of June 2025, committed to stated guidance.

PNB Housing Finance Limited recently held an investor call addressing the resignation of its MD & CEO. Despite this leadership transition, the company reassured stakeholders of its unwavering commitment to its long-term strategy. Management detailed robust guidance on growth, margins, and asset quality, emphasizing a stable operational outlook and strong foundational business.

Sustaining Robust Growth and Healthy Margins

PNB Housing Finance outlined clear growth ambitions, guiding for an 18% increase in its book for the current fiscal year. The company aims for 18-19% growth on its retail loan book, projecting it to reach Rs. 1 lakh crore by March 2027. This growth is primarily driven by an intensified focus on the Affordable and Emerging business segments, which are expected to yield higher returns and expand margins.

"We have guided 18% growth on book... This year the guidance is 18%. Last year, we had guided 17%, we delivered 18.2%." - Girish Kousgi, MD & CEO

On the profitability front, the Net Interest Margin (NIM) is projected to remain range-bound between 3.65% to 3.7% for the full year. The management anticipates margins could begin to inch up in the subsequent year, supported by the strategic shift towards higher-yielding segments. This consistent performance underscores the company's ability to maintain financial health while pursuing expansion.

Unwavering Asset Quality and Strategic Continuity

The company provided strong assurances regarding its asset quality, reporting a Gross Non-Performing Asset (GNPA) of 1.06% and a Net Non-Performing Asset (NNPA) of 0.69% as of June 2025. PNB Housing Finance remains confident in its ability to achieve a negative credit cost for the year, indicating effective risk management and collection efficiencies over 99%.

"We remain committed to our stated guidance on credit costs and NPA." - Nilesh Vikamsey, Chairperson Audit Committee

Despite the leadership change, the Board confirmed the company's strategic direction remains unchanged. Focus continues on retail lending expansion, affordable housing, and operational excellence. The company emphasized its robust internal leadership pipeline, with key internal appointments ensuring a smooth transition. A search for a new MD & CEO is underway, with an interim Executive Director appointed to maintain momentum.

PNB Housing Finance has clearly articulated a path of sustained growth and financial stability. The company's commitment to its established strategy, robust asset quality, and healthy margins, even amidst leadership changes, provides a strong foundation. This forward-looking commentary underscores management's confidence in delivering long-term value and maintaining its position as a leading housing finance company.

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