Shares of Housing & Urban Development Corporation (HUDCO), a public sector company, surged over 10 percent on Tuesday to hit an intraday high of ₹54.60, marking the largest intraday gain in December. The gain came after the stock lost 7.50 percent in the previous eight trading sessions.
The stock opened higher at ₹49.85 apiece today, compared to the previous closing price of ₹49.30 on the BSE. At 01:00 p.m., the stock was trading at ₹54.40, up by 9.74 percent on the BSE.
Over the last one month, the stock surged from around ₹40.70 to the current level of ₹54.40, delivering a return of 33.66 percent. YTD, the stock has gained 39.20 percent.
At the current market price, the dividend yield of the stock stands at 6.48 percent. The company declared an equity dividend of ₹3.50 per share in the last 12 months.
The stock gained momentum after the company reported a 7 percent rise in its consolidated net profit to ₹396.3 crore in Q2FY23 as against a net profit of ₹370.45 crore in the year-ago quarter.
However, the company's total revenue from operations came in flat at ₹1,746.9 crore during the quarter, compared to ₹1,745.6 crore in a similar quarter of last fiscal.
Gross NPAs declined by 28 basis points to 3.80 percent in Q2FY23 from 4.08 percent in the year ago quarter, while the net NPAs rose marginally by 8 basis points to 0.60 percent from 0.52 percent in the year-ago quarter. The company’s net interest margin (NIM) improved to 3.30 percent from 3.27 percent in the same period a year ago.
On November 17, Moody’s Investors Service, Singapore, affirmed the ratings of HUDCO at the "Baa3" level with a "stable" outlook, which is equivalent to that of India’s Sovereign Rating, Business Standard reported.
“HUDCO's capitalization is strong, with tangible common equity and tangible managed assets of 18.3 percent as of March 31, 2022, while the reported capital adequacy ratio (CAR) was materially higher at around 64.8 percent on the same date. The very high CAR is because its exposures to state government entities are risk-weighted at 20 percent,” the agency said.
Moody's expects the company’s liquidity and funding to remain stable over the next 12-18 months on the back of of its status as a government-owned company. While the company largely depends on wholesale funding to meet its operational requirements, its liquidity is tight because it holds limited liquidity on its books, it says.
Prior to this, India Rating and Research Private Limited (Ind-Ra) assigned HUDCO’s FY23 borrowing programme "IND AAA" or "Stable" and affirmed existing ratings, according to the BS report.
