Indostar Capital Q3 Results Review - Improvement In CV Business Momentum; Sell-Downs In SME: Motilal Oswal

NDTV Profit’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer NDTV Profit’s subscribers an opportunity to expand their understanding of companies, sectors and the economy..Motilal Oswal Report.Indostar Capital Finance Ltd. reported an improvement in business momentum during the quarter. The key highlights: Q3 FY24 disbursements rose ~6% QoQ to ~Rs 13.5 billion;it invested in human capital (added 185 employees in Q3, taking the total count to ~3,700);the commercial vehicle segment contributed ~83% to the retail disbursement mix; andasset quality improved with gross stage-III declining ~140 basis points QoQ (including sell-downs in small and medium enterprise)..Valuation and view Indostar has strategically prioritised the expansion of its loan book in the used CV and affordable housing finance segments. It anticipates that a reinforced management team, enhanced processes, and a favorable economic climate will serve as catalysts for growth in these segments. With the sell-downs of stressed Corporate and SME loans to asset reconstruction company, both of these segments now contribute only ~14% of the total assets under management mix. It has made conservative provisions on stressed loans, and we expect credit costs at ~1.2 in each of FY25 and FY26. Over the last two quarters, Indostar has made some sound business decisions, which can help this franchise make a turnaround. The risk-reward is favorable at 0.7 times FY26E price/book value. We have a 'Buy' rating on the stock with a target price of Rs 245 (based on 0.9 times FY26E book value per share)..Click on the attachment to read the full report:.Shriram Finance Q3 Results Review - Net Interest Margins Guidance Up; AUM Growth Remains Strong: IDBI Capital.DISCLAIMERThis report is authored by an external party. NDTV Profit does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of NDTV Profit..Users have no license to copy, modify, or distribute the content without permission of the Original Owner.

Indostar Capital Q3 Results Review - Improvement In CV Business Momentum; Sell-Downs In SME: Motilal Oswal

Interest income lower due to the rundown of Corporate and SME loan books

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