PNB Housing Finance (PNBHF) has been thrust into the spotlight following the sudden announcement of its Managing Director and CEO, Girish Kousgi’s resignation effective October 28, 2025. While the move surprised both investors and stakeholders, Kousgi clarified that the decision was entirely personal and driven by career aspirations, and unrelated to the exit of the private equity investors from the company. Meanwhile, the board’s Nomination and Remuneration Committee (NRC) has initiated the process for identifying a new CEO, considering both internal and external candidates.
While the Board has reaffirmed its commitment to the franchise’s growth and stability, Motilal Oswal Financial Services (MOFSL) said, the new CEO may either chart a new strategic course or build upon the strategy formulated by their predecessor. “Given the current lack of clarity, we have kept our earnings estimates unchanged and will await further clarity on the CEO appointment,” it added.
‘Key Man Risk’ at play
Since Sanjay Gupta resigned from PNB Housing in 2020, PNBHF will now be appointing its fourth MD & CEO (including an interim CEO) in a very short span, to succeed Kousgi. This factor weighed heavily on market sentiment. Motilal Oswal said that the resignation by Girish Kousgi has rekindled concerns about ‘Key Man Risk’. The share price has corrected nearly 20 per cent over two trading sessions post-announcement, underscoring the importance investors attribute to leadership stability.
According to Motilal Oswal, Kousgi was beginning to lay a strong foundation and strategic roadmap for the company’s future growth through product mix realignment and healthy execution. Under his leadership, it added, following initiatives were cheered: 1) Build-out of an affordable housing franchise which was able to scale faster than peers, 2) Strong improvement in asset quality and recoveries from the written-off pool and 3) NIM stability despite high competitive intensity. “Perhaps, this explains the sharp stock price reaction to his resignation,” it said.
Appointment of a suitable successor crucial
On these lines, the brokerage firm maintained that considering the situation, the board will have to find a suitable successor with “vintage and longevity” to lead the franchise. “Appointment of a new CEO (preferably from the industry) will be pivotal, as the company requires seasoned leadership with deep industry expertise to build on the ongoing transformation at PNBHF,” it said.
Furthermore, while the Board has reaffirmed its commitment to the franchise’s growth and stability, Motilal Oswal said the “new CEO may either chart a new strategic course or build upon the strategy formulated by their predecessor.”
Besides, the announcement of Jatul Anand and Valli Sekar to key operational roles also signals intent to build upon the existing strategic roadmap.
While the franchise has its inherent strengths however, Motilal Oswal said, “…the Board will need to instill greater investor confidence regarding: 1) the robustness of asset quality and 2) its ability to identify a suitable successor.”