Manappuram Finance - Gold Loan Growth Target Maintained: IDBI Capital
Competition intensity impacted assets under management growth as well as margins.
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IDBI Capital Report
Manappuram Finance Ltd.'s management has maintained that it expects the gold loan growth to be in the range of 8%-10% YoY on a conservative basis while sustaining gold loan yields at existing levels. Further the overall assets under management growth guidance has been maintained above 20% YoY.
The management is of the opinion that the new risk weight norms announced by Reserve Bank of India will not have any significant impact on the business of the company.
However, it expects the cost of borrowings to increase by 15-25 basis points going forward on both, the incremental as well as the existing borrowings.
Manappuram Finance is confident of its ability to pass on the same. We have moved to FY26E estimates and maintain ‘Buy’ rating with a target price of Rs 205, valuing it at 1.15 times price/adjusted book value FY26E as competition intensity eases.
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