Jefferies has reaffirmed its ‘Buy’ call on Can Fin Homes, maintaining a target price of ₹950, following a steady Q1FY26 performance that was in line with expectations. The company reported a net profit of ₹2.2 billion, growing 12% year-on-year, as lower taxes offset slightly higher operating expenses and provisions.
Loan growth during the quarter was muted, but Jefferies expects it to gradually pick up in the coming quarters, aided by favorable structural tailwinds in the affordable housing finance space. Notably, net interest margins (NIMs) improved quarter-on-quarter, and are expected to expand further in the near term, even though the company has recently cut home loan rates.
“Despite rate cuts, slower repricing of the existing book versus liabilities gives the company a buffer to expand margins,” Jefferies wrote, noting that Can Fin’s balance sheet remains well-managed and the asset quality is stable, with no major credit concerns flagged.
The brokerage projects a 13% compound annual EPS growth and a return on equity (RoE) of 16–18% over FY26–28E. At the current valuation of 1.7x FY26 book value, Jefferies finds the stock attractively priced for long-term investors.
With strong underwriting discipline, stable credit cost profile, and reasonable valuation, Jefferies believes Can Fin Homes is well-positioned for medium-term growth, and remains a preferred play in the housing finance space.
