Shriram Finance shares rally 5% after Q2 results beat Street, top Nifty gainer; brokerages bullish -- check target prices

Shriram Finance

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26 Aug, 2025 12:21

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Shriram Finance shares surged in early trade on Monday after the company posted a strong July-September quarter performance, with global brokerages reiterating bullish calls on the stock. Shriram Finance stock was trading at Rs 784 on NSE at 9.45 am, up 4.7 percent from Friday; it has gained nearly 25 percent over the past year.

The NBFC major reported a consolidated net profit of Rs 2,315 crore for Q2 FY26, up 11.6 percent year-on-year, slightly above the CNBC-TV18 poll estimate of Rs 2,216 crore. Net interest income rose 10 percent year-on-year to Rs 6,026 crore, broadly in line with expectations, while pre-provision operating profit stood at Rs 4,446 crore. Net interest margin was steady at 8.19 percent, indicating disciplined cost control and stable yields.

Shriram Finance declared an interim dividend of Rs 4.80 per share for FY26, with the payout expected by November 30. The board also approved resource mobilisation through debentures and bonds via private placement or public issue between November 2025 and January 2026, and passed a postal ballot to renew its borrowing limit of up to Rs 35,000 crore.

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Shriram Finance stock call: Should you buy or sell?

• CLSA maintained an ‘Outperform’ rating  on Shriram Finance stock with a target price of Rs 840 per share, citing a profit beat driven by lower credit costs, 16 percent annual AUM growth, and 8 percent disbursement growth led by gold loans and commercial and passenger vehicles. Margins improved by 10 basis points quarter-on-quarter on lower funding costs, while asset quality remained stable. CLSA also flagged upcoming leadership changes, with Parag Sharma set to take charge as managing director and CEO.
• Morgan Stanley retained an ‘Overweight’ stance with a target price of Rs 785, noting an 8 percent profit beat, stressed asset formation falling sharply to 1.1 percent of AUM from 4.4 percent in the previous quarter, and stable Stage 2+3 assets at 11.5 percent versus 11.9 percent in Q1 FY25, supported by coverage of 127 percent. It said a miss on NII was offset by lower operating expenses.

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