Prabhudas Lilladher's research report on Cholamandalam Investment and Finance Company
Q4 disbursements saw a tepid growth of 6.6% YoY due to a slowdown in Vehicle Finance/ new business verticals. We build a growth of ~25% in FY26E. We expect NIM to improve supported by high-yielding new business verticals and lower CoF; expect opex to be elevated as the company is in expansion mode (gold loans). Asset quality trends saw a sequential improvement and company has guided for an improvement in credit cost by ~10 bps in FY26E.
Outlook
We value CIFC with a multiple of 3.8x Mar-27 ABV (in line with 5-year trend) to arrive at a TP of Rs1,575. Assume coverage with a HOLD rating as the stock price captures all the positives.
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