Feb 25, 2013, 03.45 PM IST | Source: Moneycontrol.com

Morgan Stanley puts 'equalweight' rating on IDFC

Private sector non-banking finance company IDFC rose nearly 3 percent in early trade on Monday after the research firm Morgan Stanley has put an 'equalweight' rating on the stock with a target price of Rs 150.

Morgan Stanley puts 'equalweight' rating on IDFC

Private sector non-banking finance company IDFC rose nearly 3 percent in early trade on Monday after the research firm Morgan Stanley has put an 'equalweight' rating on the stock with a target price of Rs 150.

"RBI's regulations on new bank licenses are unclear for NBFCs, which do not have a promoter group. Since IDFC has no promoter it is not clear who can form the required financial holding company, and whether it is eligible," Morgan Stanley reasoned.

The banking regulator on Friday issued its final guidelines for grant of new banking licences and invited applications from aspirants. RBI said the applicants should have a past record of sound credentials, integrity and financial strength with a successful track record of 10 years.

RBI said non-operating finance holding company must be fully promoter-owned. "Non-operating holding company will hold 40 percent in new bank for 5 years and will cut stake in new bank to 15 percent in 12 years," the RBI added. Private companies and NBFCs can set up bank via non-operating holding company.
 
At 10:05 hours IST, shares went up 1.6 percent to Rs 158.60 on Bombay Stock Exchange.

IDFC stock price

On April 17, 2014, IDFC closed at Rs 118.30, up Rs 1.75, or 1.50 percent. The 52-week high of the share was Rs 165.45 and the 52-week low was Rs 76.25.


The company's trailing 12-month (TTM) EPS was at Rs 12.79 per share as per the quarter ended December 2013. The stock's price-to-earnings (P/E) ratio was 9.25. The latest book value of the company is Rs 88.76 per share. At current value, the price-to-book value of the company is 1.33.

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