Poonawalla Fincorp Q3 Results Review - Earnings Inline Despite Net Interest Margin Compression: 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.Poonawalla Fincorp Ltd.’s Q3 FY24 net interest income grew 63% YoY to Rs 4.9 billion (6% miss), while pre-provision operating profit jumped 125% YoY to Rs 3.5 billion (inline). Q3 profit after tax surged 76% YoY to ~Rs 2.65 billion (inline), while nine months-FY24 normalised PAT grew 72% YoY to ~Rs 6.95 billion. Opex declined 2% YoY to ~Rs 2 billion (~6% lower than estimate), while the cost/income ratio remained broadly stable QoQ at ~36% (previous year: ~57%). Provision writebacks stood at Rs 65 million (versus estimated credit costs of ~Rs 300 million). Poonawalla Fincorp is dedicated to enhancing productivity, aided by digitisation. It is gearing up for expansion with new products such as co-branded credit card, EMI cards, and dropline flexi products. Poonawalla Fincorp has laid down a robust foundation for sustainable profitability through initiatives that will lead to lower operating costs (as a % of assets under management), higher business volumes, and robust asset quality. We model a compound annual growth rate of ~42%/51% for AUM/PAT over FY23-FY26 and expect Poonawalla Fincorp to deliver an return on asset/return on equity of ~5.0%/~20% in FY26. Reiterate 'Buy' with a target price of Rs 580 (premised on four times FY26E book value per share)..Click on the attachment to read the full report:.IndusInd Bank Q3- Continued Utilisation Of Contingent Provisions Masks True Credit Cost Figure: Yes Securities.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.

Poonawalla Fincorp Q3 Results Review - Earnings Inline Despite Net Interest Margin Compression: Motilal Oswal

Recoveries from write-offs result in credit cost write-backs

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