BQ Prime'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 BQ Prime's subscribers an opportunity to expand their understanding of companies, sectors and the economy.
Systematix Research Report
Manappuram Finance Ltd.'s reported healthy performance with 37% YoY growth in profit after tax (7% beat; led by higher third party insurance commission and slightly lower tax rate).
Net interest income growth was strong at 26% YoY (on expected lines) led by 27% YoY (5% QoQ) growth in consolidated assets under management and 5 basis points QoQ increase in NIMs to 14.2%. Net yield on the gold loan book increased by 50 bps QoQ to 22.1%.
The growth in the AUM was led by 58.1% YoY (10.2% QoQ) growth in non-gold portfolio, even as gold loan AUM grew by a sluggish 8.4% YoY (1% QoQ). As a result, non-gold AUM share in overall AUM increased further to 47% from 44% in Q1.
We have increased our earning estimates by 10%/ 5% for FY24/25 to factor in higher insurance commission and margins. We estimate a 18% compound annual growth rate in Manappuram Finance's AUM to deliver a 29% CAGR in earnings over FY23- FY25E.
With optimal product mix along with improving NIMs, Manappuram Finance should be able to improve their return on asset/return on equity to 4.9%/20.0% by FY25E from 4.1%/16.6% in FY23, respectively.
Maintain our 'Buy' rating on the stock with a revised price target of Rs 180 (Rs 165 earlier).
Click on the attachment to read the full report:
DISCLAIMER
This report is authored by an external party. BQ Prime 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 BQ Prime.
Users have no license to copy, modify, or distribute the content without permission of the Original Owner.
Essential Business Intelligence, Continuous LIVE TV, Sharp Market Insights, Practical Personal Finance Advice and Latest Stories — On NDTV Profit.
