While the first three come with an “outperform” recommendation, the brokerage has initiated coverage on Aavas Financiers with a “market-perform” rating.
For Home First Finance, Bernstein’s “outperform” recommendation comes with a price target of ₹1,650, implying a potential upside of 21% from current levels.
Aptus Value’s price target of ₹400 implies a potential upside of 17% from Wednesday’s closing levels.
Bernstein expects Aadhar Housing Finance shares to gain another 22.5% from Wednesday’s closing levels, based on its price target of ₹550, while Aavas Financier’s price target of ₹2,070 does not imply significant upside from current levels.
| Stock | Target (₹) | Upside Potential |
| Home First Finance | 1,650 | 21% |
| Aptus Housing | 400 | 17% |
| Aadhar Housing | 550 | 22% |
| Aavas Financiers | 2,070 | 4.7% |
Ability to consistently replicate its operating model across multiple states is one key factor that drives Bernstein’s bullish call on Home First Finance. The company also benefits from its smaller size, faster growth and superior productivity metrics are some of the other factors that work in favour of Home First Finance. There is also greater flexibility for the company to sustain profitability compared to peers, Bernstein said.
Aptus Housing has reasonable valuations and there is a higher shares of fixed-rate loans and small business lending positions the company well in a falling interest rate environment, Bernstein wrote in its note.
Aadhar Housing serves as a good proxy in this field, being the largest and most geographically diversified players, according to the brokerage, who expects the company to maintain its steady growth trajectory of growing its Assets Under Management at a Compounded Annual Growth Rate (CAGR) of 20%.
While Bernstein does expect a near-term rebound in Aavas Financiers, inconsistent outcomes from geographic expansion makes the brokerage cautious on its long-term outlook.
Shares of Aavas Financiers have risen 4.3% in the last one month, while those of Aptus, Home First have risen 3.5% and 7.3% respectively over the same timeframe. However, shares of Aadhar Housing have been underperformers, declining 0.8% in the last one month.
