Geojit's research report on Manappuram Finance
Manappuram Finance (MGFL) is one of the leading gold loan NBFCs in India. MGFL has also diversified into other business segments like housing loan, vehicle loan and microfinance, with a branch network size of around 5,000 spread across the country. Total AUM grew by 24.3% YoY while it showcased only a marginal growth of 1.6% sequentially due to intense competition from Banks and NBFCs. Gold AUM grew by 1.5% and non gold AUM by 1.9% on a QoQ basis. With the new RBI guideline removing cap on MFI spread, the segment is expected to expand its NIM to 15%. Standalone GNPA moderated from 3.0% in Q4FY22 to 1.4% while that of Ashirvad MF increased from 3.5% to 7.7% due to increased stress from restructured book.
However, much of it is provided for and the NNPA of Ashirvad stands at 1.9%. With the attractive valuation we maintain our Accumulate rating with a target price of Rs. 127 based on 1.0x Adj BVPS of FY24E.
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