PB Fintech shares slip 15% in six months; should you enter at current levels?

Shares of PB Fintech Ltd, parent of Policybazaar and Paisabazaar, were trading 0.28 per cent higher at Rs 1,624.30. Despite the slight uptick, the stock has declined 14.60 per cent over the last six months.

With that being said, Elara Capital has initiated coverage on the counter with a 'Buy' rating.

"PB Fintech, via its flagship platform Policybazaar, has transformed India's insurance distribution by shifting a fragmented, agency-led market toward a scalable, technology-enabled ecosystem. By addressing core industry frictions – high customer acquisition cost, low-quality leads, weak conversion rates, and inconsistent servicing – the company has progressed from a comparison portal to a strategic distribution and data partner for insurers," the domestic brokerage stated.

"Its expanding capabilities across customer acquisition, risk selection, underwriting support, profit-sharing arrangements, and healthcare enablement deepen its right-to-win (RTW) and position it to capture the benefits of rising insurance penetration in India," Elara added.

"We expect a revenue CAGR of 33 per cent and a PAT CAGR of 51 per cent during FY26-29E with EBITDA margin expansion to 17.9 per cent by FY29E, driven by improving operating leverage. Policybazaar's expanding role across the value chain, together with Paisabazaar as an emerging profitability lever, positions it strongly in an underpenetrated insurance market. We believe any material reduction in intermediaries' payout by insurers would be a key risk to our estimates," the brokerage also said.

"We initiate on POLICYBZ with a Buy rating and a DCF-derived TP (target price) of Rs 1,990. This implies ~23 per cent upside, and it is underpinned by an implicit valuation of 61.0x FY28E P/E vs the stock's current 49.5x FY28E P/E," Elara further stated.

Meanwhile, PB Fintech was last seen commanding a market capitalisation (m-cap) of Rs 75,069.93 crore.