How Indiabulls Housing Finance Turned Around 🏘️

95% - that is the quantum by which the stock of Indiabulls Housing Finance (IHF) fell in a mere year and a half (Sept’18-Mar’20), with back-to-back bad news coming at the NBFC

In what was a cataclysmic shock to investors in 2018, IHF’s stock price went from Rs. 1,230 to a measly Rs. 80 as the company found itself in the middle of a shitstorm.

Since then, the company has, to put it simply, cut the bulls**t, with the stock now at around Rs. 170 - and a renewed focus to gain back the lost investor trust.

This iconic turnaround story, with immense potential, is materialising before our eyes, urging us to take a closer look.

Crisis Time

What does it take to bludgeon a company like IHF which was among the top 3 housing finance companies in the country and the top 20 largest consumer financial services companies in the world in 2018? Unfortunately, everything going wrong all at once!

Therefore, IHF became that stock that no one wanted to touch with a 10-foot pole and went down as a horrible mistake in many investors’ portfolios - until the company decided to rewrite its downtrodden fate.

Revival Time

What transpired since that awful September of 2018 was nothing short of a turnaround story of the decade, with all 3 areas that previously affected IHF detrimentally being solved:

So while revenue has taken a hit in the process, having gone down from Rs. 15,000 crore in FY18 to Rs. 8,700 crore in FY23 (around 60% of what it was in FY18), this is due to its lending capacity also reducing to around 55% of what it used to be in FY18, as part of its debt repayment.

With a clean chit on all fronts, the company is all set to now grow its lending capacity again on the back of the co-lending model, with a projected CAGR of 20% over the next 5 years!

Furthermore, in an attempt to bolster investor faith even more, the company is even planning a rebrand by changing its name to Samman Capital (which literally translates to “respect”) with plans to grow its retail lending business.

It even issued US$ 350 million in overseas bonds to fund this venture, with Blackrock having bought into this as well!

With the market finally seeing a good reason to invest back into this company, keeping this one on your watchlist might just help you witness the turnaround of the decade!

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