Habib Bank Limited (HBL) held its conference call on Friday to discuss financial performance and provide its future outlook onwards. HBL posted a profit after tax of Rs 35.51 billion (EPS: Rs 23.9) in 2021 as opposed to Rs 30.91 billion (EPS: Rs 21.1) in the same period last year, up by 15 per centYoY. It was the best ever result in the history of HBL.
Along with the result, the bank announced a final cash dividend of Rs 2.25 per share taking the full payout to Rs 7.5 per share.
Analysts at KASB Research have an outperform rating on HBL based on Justified P/B with a target price of Rs 175 per share. The stock offers a dividend yield of 7.4 per cent and is currently trading at a one year forward P/Bv of 0.57x.
As per the management, three key pillars of mid to long term strategy include accelerating Pakistan’s growth and development, shaping financial industry and improving agriculture sector’s productivity. The bank also aims to step up SMEs, branchless banking and CPEC based infrastructure growth in country.
The bank’s digital footprint is increasing day by day, the highest in the industry. Konnect accounts are up by 1.3x 7.1 million.
The bank crossed Rs 100.0 billion in consumer loans. Consumer financing grew by 31 per cent reaching Rs 102.8 billion driven by growth in auto and personal loans.
Home remittances for the bank also increased by 29 per cent YoY in 2021 to USD 2.74 billion and the market share clocked in at 8.8 per cent. The bank aims to take the market share to double digits in 2022.
Domestic deposits noted a growth of 19 per cent over December 2021 and the banks’ market share improved to 14.4 per cent. Meanwhile, international deposits increased by 16 per cent to USD 1.9 billion. CA crossed Rs 1.0 trillion.
Domestic advances expanded by 20 per cent over December 2020 to Rs 1.2 trillion and international loans increased by 24 per cent.
Infection ratio clocked in at 5.1 per cent as opposed to 6.3 per cent in December 2020 and the bank’s coverage stood at 104 per cent.
ROE came at 14.4 per cent and ROA stayed at 0.9 per cent in December 2021.
The bank intends to expand Islamic banking by adding 30/40 new branches in different new cities taking the tally to 250-260 by December 2022.