Piramal Finance’s four-year transformation has been a deliberate, disciplined derisking exercise, shifting the business from a wholesale-heavy model to a diversified, retail-led franchise with far more predictable performance.
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Motilal Oswal Report
Piramal Finance Ltd. has emerged as a large, young, and fast-scaling non-banking financial company with a clear leadership position in semi-urban India. The company’s disciplined pivot toward retail, strong growth in affordable housing, competitive pricing, stable risk behavior, and improving operating leverage position it well for meaningful profitability expansion.
With a clear pathway toward improving RoA, reducing legacy wholesale portfolio, potential credit rating upgrade, and additional capital release from any Shriram Life/General stake sale, we expect consistent compounding over the next several years.
Piramal Finance is now moving into a phase where the benefits of its multi-year transformation should start reflecting more strongly in its financial performance.
With a predominantly retail portfolio in place, the company is positioned for greater stability in credit costs and clearer margin visibility. The earnings volatility of the transition years is now firmly behind it, as the legacy wholesale book has been substantially run down and the retail engine will now drive consistent, predictable outcomes.
We estimate a total AUM CAGR of ~23% and a ~26% CAGR in Retail AUM over FY25-28.
We recently upgraded the stock to Buy and we maintain our stance with a revised target price of Rs 1,790 (based on Sep’27 SOTP).
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