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ICICI Securities Report
ICICI Securities has maintained a ‘Buy' rating on CreditAccess Grameen Ltd., citing strong growth visibility driven by its strategic pivot towards a diversified rural finance model. The brokerage has retained its target price at Rs 1,750, implying an upside potential of around 28% from current levels.
The brokerage highlighted that the company is undergoing a structural transition from a pure microfinance institution (MFI) to a rural-focused retail finance platform, aimed at increasing wallet share and diversifying its loan book. This shift is being driven through its strategic initiative,‘Project Shakti', which targets long-term AUM growth of 20–25% and improved profitability metrics.
While management acknowledges the collection risk due to El Nino, it highlighted that historical trends suggest that during such events, even if collections are impacted, they normalise within a short period. Hence, in the past, El Nino has not impacted profitability materially. Therefore, it continues to retain its FY27 credit cost guidance of 3–4% even after factoring in El Nino.
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