Edelweiss is bullish on Reliance Capital has recommended buy rating on the stock with a target price of Rs 767 in its research report dated June 15, 2017.
Edelweiss' research report on Reliance Capital
Armed with an experienced team and heightened focus (now a separate entity), strategically the aim is to move away from being a predominant SME lender to emerge as a diversified lender. The 2-pronged strategy is to carve a niche in personal finance by creating strategic assets (mobile first acquisition process, leveraging group database, etc), while increasing market share in the strong SME domain.
Though insurance profitability remains under pressure, we expect improvement post consolidation. We believe potential improvement in earnings will narrow down the discount between current price and inherent fair value of core businesses. We maintain ‘BUY/SP’ with SoTP of INR 767.
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