Ace investor Madhu Kela's latest smallcap bet - SG Finserve shares hit 20% upper circuit

Over the past month, this small-cap stock has surged more than 23 percent

Shares of SG Finserve soared to hit the 20 percent upper circuit at Rs 432 per share on March 25, following a significant bulk deal involving renowned investor Madhusudan Murlidhar Kela. He acquired 9.51 lakh shares—equivalent to a 1.7 percent stake—at Rs 350.01 per share on the BSE on March 24.

SG Finserve, a technology-driven non-banking financial company (NBFC) registered with the Reserve Bank of India (RBI), specialises in business financing solutions. It caters to a wide range of channel partners, including dealers, distributors, retailers, buyers, suppliers, and transporters.

In a recent development, CRISIL Ratings reaffirmed the credit rating for SG Finserve’s Rs 1,000 crore bank loan facilities, assigning an AA (CE)/Positive rating, transitioning it from a provisional rating to a final one.

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Financially, the company posted a strong performance in Q3FY25, reporting a profit of Rs 236 crore—up significantly from Rs 141 crore in Q2FY25. Revenue from operations surged to Rs 424 crore in the December quarter, compared to Rs 309 crore in the previous quarter. Meanwhile, total expenses saw a slight uptick to Rs 103 crore in Q3 from Rs 102 crore in the preceding quarter.

A notable highlight from the quarter was SG Finserve’s loan book expansion, which nearly doubled from the September quarter. The loan book stood at Rs 1,568 crore, marking an impressive 92 percent quarter-on-quarter growth. The management has expressed confidence in expanding this figure to Rs 5,000 crore within the next two to three years.

The company also highlighted its strengthened capital base, which currently stands at approximately Rs 1,000 crore. Management expects this to increase to around Rs 1,500 crore by FY27, with Rs 350 crore in committed preferential investments set to be infused.

“With this momentum, we remain confident in achieving our loan book targets of Rs 4,000 crore in FY26 and Rs 6,000 crore in FY27,” the company previously stated.

Among analysts, Arihant Capital Markets is the sole brokerage tracking SG Finserve, and it maintains a ‘buy’ rating on the stock, with a target price of Rs 783.

Over the past month, this small-cap stock has surged more than 23 percent, significantly outperforming the benchmark Nifty 50 index, which has risen by 5 percent in the same period.

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