Buy Poonawalla Fincorp; target of Rs 417: Anand Rathi

Anand Rathi's research report on Poonawalla Fincorp

The erstwhile Magma Fincorp, now Poonawalla Fincorp has seen perhaps, one of the fastest turnarounds in the BFSI sector. Poonawalla Fincorp (PFL) is now a tech led high growth NBFC backed by a strong promoter and having topnotch processes and best-in-class cost-of-funds. With digital as core for the new management, we expect robust growth, competitive cost of funds and tech savviness to drive a 38% loan CAGR over FY23-25e for the standalone unit.

Outlook

We retain our Buy stance on the company with a target price of Rs.417, valuing it at 3.0x FY25e standalone P/BV,derived usinga multi-stage DDM method.

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