LIC Housing Finance Sees 11% Net Profit Growth Amidst NIM Challenges

LIC Housing Finance reported an 11% rise in net profit to Rs 1,324 crore during the September quarter despite a decline in core net interest income. Efforts to boost higher-yield assets are underway to counter reduced net interest margins, while asset quality showed improvement with a lower NPA ratio.

LIC Housing Finance on Monday reported an 11 per cent increase in net profit for the September quarter, totaling Rs 1,324 crore on a consolidated basis. This marks an improvement from the Rs 1,192 crore posted during the same period last year.

The decrease in core net interest income by 6 per cent year-on-year was overshadowed by a 6 per cent rise in assets under management. However, a significant decline in net interest margin (NIM) to 2.71 per cent from 3.04 per cent raised concerns.

Chief Executive and Managing Director Tribhuvan Adhikari acknowledged challenges in core income and noted ongoing efforts to enhance the mix of higher-yield assets. The firm remains focused on expanding into new segments for better pricing, such as self-employed loans and affordable housing. Despite these hurdles, the asset quality showed improvement, with the gross non-performing assets ratio improving to 3.06 per cent from 3.31 per cent. The company's shares closed up by 3.53 per cent at Rs 619.30 on the BSE.

(With inputs from agencies.)