15% Dividend Payout Soon: Miniratna PSU NBFC Fixes Record Date; To Raise Rs 40,000 Crore; Technical Analysis

Housing & Urban Development Corporation Ltd (HUDCO), a Miniratna CPSE, has recommended an interim dividend of Rs 1.50 per share for FY24. In percentage terms, the dividend payout is 15%. Apart from this, on Wednesday, the company received board approval for fundraising up to Rs 40,000 crore. Also, the NBFC player is going to increase its borrowing limit to Rs 1.50 lakh crore.

HUDCO Share Price:

On BSE, HUDCO's share price stood at Rs 175.70 apiece on March 20th, down by 0.9% with a market cap of Rs 35,173.38 crore.

The midcap stock's 52-week high and low is at Rs 226.95 apiece and Rs 40.50 apiece.

Currently, the stock has jumped by 333.83% from its 1-year low. The year 2024 so far has been positive for HUDCO shares with YTD gains over 36%. In a year, the stock advanced by 299% on the BSE so far.

HUDCO Dividend:

In a board meeting held on March 20, HUDCO's board of directors approved an interim dividend for the financial year 2023-24, to the tune of 15% aggregating to Rs 1.50 per share, having a face value of Rs 10 each.

This will be the first interim dividend for FY24. The company fixed March 29, 2024, as the record date for determining the eligibility of shareholders for the latest dividend payout. The process for payment of Interim Dividend will be completed within 30 days of its declaration.

In FY23, HUDCO paid dividends up to 38.50% valuing to Rs 3.85 per share. On the current price level, HUDCO has a dividend yield of 2.19%.

HUDCO Fundraising:

Further, HUDCO's board approved the raising of funds through the issue of bonds/debentures, up to a maximum amount of Rs. 40,000 Crore during the financial year 2024-25, depending upon actual funds requirement.

HUDCO Borrowing Limit:

Additionally, the company received approval for its proposal of increasing the overall borrowing limit to Rs 1,50,000 Crore from the existing limit of Rs 1,00,000 Crore as earlier approved by shareholders u/s 180(1)(c) of the Companies Act, 2013, subject to the approval of same by Shareholders.

HUDCO Earnings:

For the nine months of FY24, HUDCO's total income stands at Rs 5,754.06 crore, up by 10% YoY, while its net profit is at Rs 1,416.58 crore also up by 33% YoY. The loan book stands at Rs 84,424 crore in 9MFY24, up by 6.50% YoY. Further, its net worth was at Rs 16,247.54 crore, up by 8% YoY.

HUDCO's Low-Risk Business Module:

HUDCO has a strong relationship with State Governments, reflected in higher participation in government housing and urban infrastructure programmes.

As of December 31, 2023, approximately 97.17% of the total loan portfolio was to state governments and their agencies. HUDCO has a low-risk profile as the maximum part of the loan book consists of loans to the State Govt. and its agencies bearing the low risk of NPAs.

Meanwhile, gross NPAs for loans made to the private sector were 2.42%compared to 0.70% for loans made to the Government and their agencies as of December 2023.

HUDCO Fundamentals:

As per Trendlyne data, the following are key fundamentals for HUDCO's stock price:

- Stock Price rose 295.16% and outperformed its sector by 236.73% in the past year.

- Debt to Equity Ratio of 4.07 is higher than 1. This implies that company assets are financed through debt.

- Mutual Fund Holding increased by 1.52% in the last quarter to 2.71.

- Interest Coverage Ratio is 1.51, higher than 1.5. This means that it can meet its interest payments comfortably with its earnings (EBIT).

- Price to Earning Ratio is 17.11, lower than its sector PE ratio of 19.54.

- Return on Equity(ROE) for the last financial year was 11.01%, in the normal range of 10% to 20%.

- Promoter Share Holding decreased by 6.64% in the most recent quarter to 75.17%.

- Promoter Pledges are zero.

About HUDCO:

A Public Sector Company, under the Ministry of Housing and Urban Affairs (MoHUA), HUDCO has been a key partner with the Government in building assets for the Nation. In its operations, HUDCO lays a considerable emphasis on the housing needs of the "deprived" that is Economically Weaker Sections (EWS) and Low-Income Groups (LIG).