Share of Housing Finance market – Here’s a list of players by the quantum of home loans.
| Housing Finance companies | LOAN OUTSTANDING/AUM
As of Mar-24 Rs in Cr |
PE | Market Cap | Market Share |
| HDFC BANK | ₹ 7,72,786.00 | 18.96 | ₹ 12,92,266.29 | 22.208% |
| SBI | ₹ 7,25,818.00 | 9.71 | ₹ 7,07,141.61 | 20.858% |
| ICICI BANK | ₹ 2,96,940.75 | 19.51 | ₹ 9,08,025.54 | 8.533% |
| LIC HF | ₹ 2,86,844.00 | 7.88 | ₹ 37,113.00 | 8.243% |
| Bank Of Baroda | ₹ 1,11,791.00 | 6.45 | ₹ 1,22,897.38 | 3.213% |
| Kotak Mahindra Bank | ₹ 1,06,726.00 | 17.13 | ₹ 3,65,515.96 | 3.067% |
| PNB | ₹ 93,694.00 | 10.2 | ₹ 1,19,689.72 | 2.693% |
| HUDCO | ₹ 92,654.00 | 21.86 | ₹ 48,145.65 | 2.663% |
| Canara Bank | ₹ 93,482.00 | 6.22 | ₹ 95,559.36 | 2.686% |
| BAJAJ HF | ₹ 91,370.00 | 69.3 | ₹ 1,44,501.61 | 2.626% |
| Union Bank | ₹ 86,079.00 | 6.61 | ₹ 93,969.69 | 2.474% |
| Indian Bank | ₹ 66,423.00 | 7.46 | ₹ 68,021.66 | 1.909% |
| PNB HF | ₹ 65,358.00 | 17.36 | ₹ 28,023.03 | 1.878% |
| Samman Capital | ₹ 65,335.00 | 9.58 | ₹ 11,593.43 | 1.878% |
| Axis Bank | ₹ 64,163.00 | 14.4 | ₹ 3,84,401.03 | 1.844% |
| IDBI Bank | ₹ 62,272.00 | 15.3 | ₹ 96,750.15 | 1.790% |
| Bank Of India | ₹ 59,107.00 | 7.38 | ₹ 50,375.00 | 1.699% |
| Central Bank Of India | ₹ 44,057.00 | 16.5 | ₹ 51,322.00 | 1.266% |
| Can FIN Home | ₹ 34,999.00 | 15.26 | ₹ 11,689.00 | 1.006% |
| Bandhan Bank | ₹ 29,920.00 | 13.1 | ₹ 33,605 | 0.860% |
| Bank Of Maharastra | ₹ 29,786.00 | 9.18 | ₹ 41,199 | 0.856% |
| Federal Bank | ₹ 28,021.00 | 11.2 | ₹ 45,182 | 0.805% |
| Indian Overseas Bank | ₹ 27,621.00 | 39.6 | ₹ 1,12,186.00 | 0.794% |
| UCO Bank | ₹ 23,688.00 | 29.3 | ₹ 58,166.00 | 0.681% |
| IDFC First Bank | ₹ 22,325.00 | 19 | ₹ 54,068 | 0.642% |
Conclusion
Among the top 25 companies in the Housing Finance space, only six are pure-play housing finance companies with a market share exceeding 1%.
In the frenzy surrounding the IPO of Bajaj Housing Finance, and its positioning as a major player in the market, investors overlooked the fact that the largest and the most profitable housing finance company in India is infact HDFC Bank, with an outstanding loan portfolio of ₹7,72,786 crore and a market share of 22.21%. This is closely followed by SBI, with loans outstanding at ₹7,25,818 crore and a market share of 20.86%.
Interestingly, despite the hype, Bajaj Housing Finance doesn’t even rank among the top five, with loans outstanding of ₹91,370 crore and a market share of just 2.63%. Yet it commands the highest premium, trading at a multiple of 69+ on Price to Earnings basis.
While Bajaj Housing Finance has garnered attention, the dominant players in the home loan space remain established banks such as HDFC and SBI. These institutions, with their long-standing presence, continue to maintain a significant lead in the market.
Our Take
The home loan industry is one of the most competitive sectors in the Indian economy, with over 40 companies vying for market share. More than 20 of these have less than 1% market share, while the banking sector holds a significant presence.
The industry is on a growth trajectory, driven by a rising economy, urbanization, government incentives, increasing acceptance of credit, and a shift towards nuclear families. This growth has attracted many players, intensifying competition to retain or expand market share and maintain profitability.
Banks, with their long-established presence and wider distribution networks, hold a distinct advantage over housing finance companies due to access to lower-cost funds raised through deposits. This gives them a competitive edge in terms of both profitability and scalability.
Which Housing Finance Company To Invest In?
With more attractive valuations, banks like HDFC and Axis offer a stronger investment opportunity in the housing finance sector compared to standalone housing finance companies.
As seen in the table, HDFC trades at a P/E ratio of 18, while Bajaj Housing Finance is priced at a significantly higher P/E of 69. For investors seeking exposure to housing finance space, established banks provide a more diversified alternative.
These factors are among the many reasons we believe HDFC Bank and Axis Bank are well-positioned for long-term outperformance. We have detailed our bullish outlook on both banks in previous articles, outlining the key drivers behind our confidence in their sustained growth and potential to deliver superior returns.
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