Hold Magma Fincorp; target of Rs 22: ICICI Securities

Trade

• Watchlist
• Portfolio
• Message
• Set Alert

 

 

Choose Stock Exchange: BSE LIVE NSE LIVE

26 Aug, 2025 12:21

Volume

Todays L/H

More

×

ICICI Securities research report on Magma Fincorp

Magma Fincorp (Magma) reported a Q4FY20 loss of Rs355mn led by lower NII and higher effective tax rate. Magma ranks below its peers on many parameters – franchise strength, liquidity position, asset resilience, earnings/return stability and cost efficiency. This was evident from a relatively higher proportion of its AUM under moratorium. Moratorium in the vehicle finance, affordable housing (AHF) and SME book stood at 84%, 53% and 56% respectively. On the consolidated book, customers availing moratorium (by value) for April was ~64% and for May it was ~73% - suggesting that the moratorium was up MoM but the company is making earnest efforts to bring it down.

Outlook

High risk unsecured lending in its SME book (even though ~76% of this book is secured under CGT-MSE) and LAP (within AHF business) could mean asset quality would further deteriorate with consequent higher credit costs in FY21. Maintain HOLD.

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.

Read More