Sundaram Finance Q3 Results Review: Inline; Market Share Gain Drive Growth — Systematix Maintains 'Hold'

At the industry level commercial vehicle segment (CV segment forms ~45% of total AUM for Sundaram Finance) continue to report a weak sales growth despite festive season, which is concerning..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..Systematix Research Report.Sundaram Finance Ltd. reported better than expected net interest income at Rs 6.4 billion (versus estimate of Rs 5.9 billion) registering a growth of 28% YoY (14% QoQ) led by healthy business growth and NIM (calc) expansion (43 bps QoQ). However, due to lower other income, operating profit was in line with estimates. Credit cost for the quarter inched up by 8bps QoQ at 74bps. AUM growth remained strong at 19% YoY (5% QoQ) aided by strong growth in disbursements (19% YoY / 13% QoQ) which is led by market share gain across products. Asset quality deteriorated marginally with gross/ net stage 3 at 1.7%/1.0% (+8bps QoQ). Provision coverage ratio on stage 3 assets also dropped to 43% vs 45% in Q2 FY25. Sundaram Finance has reported exceptionally strong disbursements growth during Q3 while its peers have witnessed a weak disbursements trend. At the industry level commercial vehicle segment (CV segment forms ~45% of total AUM for Sundaram Finance) continue to report a weak sales growth despite festive season, which is concerning. The stock trades at a fair valuation of 3.5x FY27E core book value, with RoA/ RoE at ~3%/~19%, respectively. Hence, we maintain our Hold rating on the stock with a revised target price of Rs 4,450 (earlier Rs 4,300)..Click on the attachment to read the full report:.Divi's Labs Q3 Review: Custom Synthesis Drives Earnings; Generics Stable — Motilal Oswal Retains 'Neutral'.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.

Sundaram Finance Q3 Results Review: Inline; Market Share Gain Drive Growth — Systematix Maintains 'Hold'

The stock trades at a fair valuation of 3.5x FY27E core book value, hence, the brokerage maintains Hold rating and hikes target price to Rs 4,450.

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