Shriram Finance Ltd. has been added to Nifty 50 by the National Stock Exchange as the non-bank finance company's shares nearly doubled in the past year, making it eligible for an entry into the benchmark index.
Business Outlook
Shriram Finance share surge has been driven by the growth in its business and assets. The growth was led by the passenger vehicle business and the non-vehicle consumer businesses.
The non-bank lender's total income rosed 17.3% over a year earlier to Rs 8,927 crore in the quarter ended December. Net profit rose 2.3% at Rs 1,818 crore.
Total assets rose 20.7% year-on-year to Rs 2,14,233 crore. Its asset quality also improved sequentially, with gross and net non-performing assets falling to 5.66% and 2.72%.
Nomura echoes management's guidance of a 20% and 15% growth in asset under management in FY24 and FY25.
HSBC sees a 17% annualised growth in assets over FY24-26, primarily driven by non-vehicle consumer businesses.
Street View
Nomura and HSBC are optimistic on the stock.
Nomura maintains a 'Buy' rating with a target price of Rs 2,700, implying a potential upside of about 13% from the current levels.
HSBC, too, has a 'buy' stance with a revised target price of Rs 2,720, suggesting an upside of nearly 14%.
Among 37 analysts tracking the stock, 35 have a 'Buy', and one each recommend hold and sell, according to Bloomberg data. The average of 12-month analyst price targets suggests an upside potential of 14.6%.
RECOMMENDED FOR YOU
LG Electronics Shares Trade At Lowest Level Since Listing — Here's Why
BMC Elections 2026: Over 2,500 Candidates Enter Poll Fray; 2,122 Nominations On Closing Day
Shriram Finance 'Fuelled Up For Growth', Says Brokerages As Jefferies, Nomura Hike Target Price
Nifty Ends Near 26,000, Sensex Gains 400+ Points As Shriram Finance-MUFG Deal Boosts Sentiments
POPULAR