Manappuram Finance - Well-Entrenched Franchise, Attractive Valuations: ICICI Securities

Strategic focus on business diversification will likely fortify the business offering enhancing the value proposition.

<div class="paragraphs"><p>Gold bangles inside a jewelry shop in Zaveri Bazaar. (Source: BQ Prime)</p></div>
Gold bangles inside a jewelry shop in Zaveri Bazaar. (Source: BQ Prime)

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.

ICICI Securities Report

Yield stabilisation in gold loans and turnaround in the micro finance business are noteworthy developments in Manappuram Finance Ltd.

Company has guided for 10-12% gold assets under management growth with 21-22% yields while its growth guidance for MFI segment is more than 30% for FY24. However, rising cost of funds in both the businesses and overall elevated competition in gold loans remain headwinds.

Strategically, Manappuram Finance is focussing on diversification (aiming to take gold loan mix down to 50%), digital transformation and employee investment.

Manappuram Finance currently trades at an attractive valuation of one time FY25E consolidated price/book. Maintain 'Buy'.

Key risks include:

  1. yield reduction and continued slow growth in gold loan business, and

  2. asset quality issues with growth in non-gold loan business.

Click on the attachment to read the full report:

ICICI Securities Manappuram Finance Company Update.pdf
Adani Group Rejects 'Recycled Allegations' In OCCRP Report


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.