Shriram Finance - Growth, Asset Quality In Good Shape: Yes Securities

"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..Yes Securities Report.Post-merger entity Shriram Finance Company Ltd. is a multi-product play having synergistic growth spurt at disposal. Its stronger assets under management growth of 4% QoQ/18.6% YoY in Q1 FY24 surprised many. In our view, the growth momentum could likely continue through the year aided by-residual benefits of value growth in used commercial vehicle/passenger vehicle financing (50%/19% of AUM),firm replacement demand for used PVs,phased roll-out of micro, small and medium enterprise loans (10% of AUM) in vehicle financing branches,distribution of gold loans (3% of AUM) taken to substantial number of vehicle financing branches, andsustained momentum in personal loans (4% of AUM)..We expect 14-15% AUM compound annual growth rate and 18-19% earnings CAGR over FY23-25 with average return on asset/return on equity delivery of 3.3%/16%. For reviewing estimates, we would closely monitor-pricing and volume growth in used CV/PV segment,distribution roll-out of gold loan and MSME Loans in vehicle financing branches and success in cross-sell,emerging signs of stress in personal loan and MSME loan portfolios (Stage-II coverage seems low in these products) andcost of funds. Even after a strong run-up in the past three-four months, the stock’s valuation is reasonable at 1.4 times price/adjusted book value and 8.5 times price/earning on FY25 estimates. Retain 'Buy' with an upgraded 12 million target price of Rs 2300..Click on the attachment to read the full report:.Aavas Financiers, Aptus Value, Home First Finance Gets A 'Buy' As Centrum Broking Initiates Coverage.DISCLAIMERThis 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."

Shriram Finance - Growth, Asset Quality In Good Shape: Yes Securities

Reasonable valuation for healthy growth and profitability.

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Shriram Finance - Growth, Asset Quality In Good Shape: Yes Securities

Reasonable valuation for healthy growth and profitability.

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