Axis Direct is bullish on Cholamandalam Investment has recommended buy rating on the stock with a target price of Rs 1550 in its research report dated February 22, 2018.
Axis Direct's research report on Cholamandalam Investment
CIFC posted a stellar Q3 with 53% YoY growth in PAT to Rs 2.5 bn (higher than our and consensus estimates). Strong earnings growth was backed by uptick in disbursements (up 55%/23% YoY/QoQ) and improvement in asset quality with ~80 bps QoQ decline in GNPA ratio to 3.7%. AUM growth at 20% YoY was highest in past 15 quarters.
OutlookMaintain BUY with rolled forward TP of Rs 1,550 (valued at 3.6x FY20 ABV): We continue to like CIFC for its welldiversified vehicle finance (VF) book, voluntary slow-down in home equity (HE) portfolio, investments in tech (that will drive operating leverage) and newer products like trip finance and home loans (which yield results post a couple of years). At CMP, CIFC trades at 3.6x/ 3x FY19E/ FY20E ABV of Rs 356/ Rs 425.
For all recommendations report, click here
Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.Get access to India's fastest growing financial subscriptions service Moneycontrol Pro for as little as Rs 599 for first year. Use the code "GETPRO". Moneycontrol Pro offers you all the information you need for wealth creation including actionable investment ideas, independent research and insights & analysis For more information, check out the Moneycontrol website or mobile app.