Manappuram Finance shares jump 8% to hit one-year high; brokerage view, tech charts & more

Shares of Manappuram Finance Ltd rose sharply in Thursday's trade, extending their gains for the fourth straight session. The stock surged 7.88 per cent to hit a 52-week high of Rs 162.30 over its previous close of Rs 150.45. On BSE, around 12.69 lakh shares were last seen changing hands today. The figure was way more than the two-week average volume of 6.76 lakh shares. Turnover on the counter stood at Rs 20.14 crore, commanding a market capitalisation (m-cap) of Rs 13,593.74 crore.

Manappuram Finance's stock has gained around 35 per cent in 2023 so far and 43 per cent in the last six months.

The Kerala-based shadow lender said its profit for the quarter rose 36.91 per cent year-on-year (YoY) to Rs 560.65 crore compared with Rs 409.49 crore in the same quarter last year. The company also declared an interim dividend of 85 paise per equity share.

The gold loan company has fixed November 24 as record date to ascertain the entitlement of interim dividend among the shareholders and said the dividend warrants would be paid or dispatched on or before December 12.

Manappuram Fin's interest income for the quarter came in at Rs 1,404.94 crore compared with Rs 1,238.03 crore YoY. Gold loan segment's revenue for the quarter stood at Rs 1,537.22 crore against Rs 1,297.88 crore in the same quarter last year. The segment revenue for micro finance stood at Rs 636.80 crore against Rs 1,416.33 crore YoY.

Motilal Oswal has given a 'Buy' call on the counter with a target price of Rs 180. "We raise our FY24E/FY25E EPS by 5 per cent/6 per cent to factor in stronger growth in the non-gold segments and higher other income. We estimate a 10 per cent/20 per cent AUM CAGR in gold/consolidated book over FY23-26. We model a consolidated PAT CAGR of 27 per cent over the same period to arrive at consolidated RoA/RoE of 5 per cent/20 per cent in FY26. Reiterate 'Buy' with a target price of Rs 180 (based on 1.0x Sep'25E consolidated BVPS)," the brokerage stated.

"The management has stated that it will not pursue loan growth at the cost of a compression in spreads, which we believe will continue to be a driver for higher profitability. Risk-reward for the NBFC is favorable," it added.

As of September 2023, promoters held 35.20 per cent stake in the company.

The counter's 14-day relative strength index (RSI) came at 72.99. A level below 30 is defined as oversold while a value above 70 is considered overbought. The company's stock has a price-to-equity (P/E) ratio of 8.92 against a price-to-book (P/B) value of 1.32.

The scrip has an analyst target price of Rs 169, Trendlyne data showed, suggesting a potential upside of 5 per cent in a year. It has a one-year beta of 0.3, indicating low volatility on the counter.

(Disclaimer: Business Today provides stock market news for informational purposes only and should not be construed as investment advice. Readers are encouraged to consult with a qualified financial advisor before making any investment decisions.)

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