Can Fin Homes FY25 profit surges 14% to Rs 857cr, dividend raised to Rs 12 as FIIs increase stake

Can Fin Homes Delivers Strong FY25 Results with 14% Profit Growth and Rising Investor Confidence

Can Fin Homes Limited has reported an impressive set of financial results for the fiscal year ending March 31, 2025, reinforcing its standing as one of India‘s most efficient housing finance companies. The company clocked a net profit of ₹857 crore in FY25, up 14% year-on-year from ₹751 crore in FY24, driven by strong growth in loan disbursements, a steady loan book expansion, and firm control over asset quality. For the fourth quarter alone, net profit rose to ₹234 crore, reflecting a 10% increase over the ₹212 crore reported in the preceding quarter.

The robust financial performance has prompted Can Fin Homes to reward shareholders with a final dividend of ₹6 per share, on top of an interim dividend of ₹6 already disbursed, bringing the total payout for FY25 to ₹12 per share. This move highlights the company’s confidence in its liquidity strength and earnings visibility.

What Factors Contributed to Can Fin Homes’ Strong FY25 Performance?

The company’s net loan assets surged 9% year-on-year to ₹38,217 crore in March 2025, up from ₹34,999 crore the previous year. The housing loan segment continues to dominate Can Fin Homes’ portfolio, accounting for 76% of the total book, with non-housing and commercial real estate loans making up the remaining 24%. This concentration in home loans reflects the lender’s strategic focus on low-risk, income-verified borrowers, particularly from the salaried segment.

Disbursement momentum accelerated as well. For Q4FY25, loan disbursements reached ₹2,455 crore, registering a 6% quarter-on-quarter rise, and a striking 31% sequential increase compared to Q3FY25. On an annual basis, disbursements stood at ₹8,568 crore, 5% higher than the previous year, demonstrating resilient demand in India’s expanding residential real estate markets.

While the net interest margin (NIM) eased slightly to 3.64% from 3.73% in FY24, profitability ratios remained healthy. Return on assets (ROA) was reported at 2.24%, while return on equity (ROE) improved to 16.92% in FY25, reflecting superior capital efficiency and margin management despite a competitive lending environment.

How Stable Is Can Fin Homes’ Balance Sheet and Liquidity Position?

On the liability side, Can Fin Homes’ debt-to-equity ratio declined to 6.96 from 7.34 in FY24, showcasing disciplined leverage and effective capital planning. The Liquidity Coverage Ratio (LCR) stood at 117.86% as of March 2025—significantly above the 85% regulatory threshold—indicating strong liquidity management. The company also reported ₹3,194.58 crore in undrawn bank lines, which, along with internal accruals, comfortably covers business needs for the next quarter.

To diversify its funding base, the company is actively promoting fixed deposits, which stood at ₹187 crore at the end of the year. Can Fin Homes is offering an 8.00% annual interest rate for 36-month cumulative deposits, with senior citizens eligible for an additional 0.25%. The fixed deposit programme is rated “AAA” with a stable outlook by ICRA, reinforcing the company’s credibility and financial stability.

Its commercial papers carry an “A1+” rating, while its long-term debt and subordinated instruments maintain a “AAA” stable rating from both CARE Ratings and ICRA.

How Has Can Fin Homes Managed Credit Risk and Asset Quality?

The company has maintained prudent risk management practices throughout FY25. As per Ind AS 109, Can Fin Homes has created expected credit loss (ECL) provisions totalling ₹351 crore. Additional provisions include ₹59 crore as a management overlay and ₹49 crore for restructured accounts, taking total provisions to ₹466 crore.

By maintaining a proactive provisioning strategy, the company ensures resilience against macroeconomic uncertainties and potential borrower defaults, especially in a fluctuating interest rate environment. The cautious underwriting model, focused primarily on salaried individuals with predictable income flows, has helped sustain stable asset quality across credit cycles.

How Has the Market Reacted to Can Fin Homes’ Performance?

As of April 23, 2025, Can Fin Homes’ stock (NSE: CANFINHOME) closed at ₹744.90, marking a 0.69% increase on the day. Over the past month, the stock gained approximately 8.7%, while its three-month performance showed a rise of 9.11%. Despite a slight year-to-date decline of 1.06%, the stock remains within a healthy 52-week range of ₹558.50 to ₹951.75, suggesting a balanced risk-reward proposition for investors.

What Are Institutional Investors Saying?

Foreign Institutional Investors (FIIs) have responded positively to the company’s FY25 performance, increasing their stake from 11.41% to 12.14% in the March quarter. This uptick signals enhanced global investor confidence in the company’s fundamentals and governance practices.

Conversely, Domestic Institutional Investors (DIIs) slightly trimmed their holdings, reducing their share from 28.14% to 24.66% in the same period. Nevertheless, mutual fund interest surged, with the number of schemes invested in the stock rising from 22 to 77—an encouraging sign of expanding institutional backing.

What Do Valuation Metrics and Analyst Sentiment Reveal?

Can Fin Homes is currently trading at a Price-to-Earnings (P/E) ratio of around 11.6, and a Price-to-Book (P/B) ratio of 2.1. These levels indicate reasonable valuations, particularly for a company with a Return on Equity (ROE) of 18.2% and a dividend yield of 0.81%. These fundamentals reflect both operational efficiency and shareholder-friendly capital allocation.

Analyst sentiment is overwhelmingly positive, with seven rating the stock a ‘Strong Buy’, six issuing a ‘Buy’ rating, and three recommending to hold. There are no ‘Sell’ or ‘Strong Sell’ calls, which suggests a broadly bullish outlook from equity researchers monitoring the Indian housing finance space.

Is Can Fin Homes a Stock to Buy, Hold or Avoid?

For investors seeking exposure to India’s residential credit expansion and stable dividend income, Can Fin Homes offers a compelling mix of consistent earnings, strong institutional backing, and efficient operations. The company’s conservative lending approach, focused portfolio mix, and disciplined liquidity management create a solid base for sustained long-term performance.

While short-term volatility may persist amid broader macroeconomic shifts, Can Fin Homes remains structurally well-positioned. Analysts maintain that it merits a ‘Buy’ to ‘Hold’ view, with upside potential tied closely to housing demand in semi-urban and urban centres and supportive policy initiatives under India’s housing for all mandate.