China-based internet giant Tencent, on May 26, sold a 2.09 percent stake in PBfintech, worth Rs 562.06 crore, data from BSE showed. The company's stock fell 4 percent during the day.
The company sold a total of 9,416,250 shares for Rs 596.66 a piece via a bulk deal, as per the data shared by BSE. The company earlier held an 8.37 percent stake, which will come down to 6.28 percent post this sale.
Moneycontrol has reached out to PBFintech for a comment.
Shares of PB Fintech Ltd, the parent company of Policybazaar, fell to a low of Rs 596.30 on 26 May, while India's benchmark Sensex rose 0.16 percent to 61,974 points.
In December last year, SoftBank sold about 228,424,24 shares amounting to a 5.1 per cent stake worth Rs 1,043 crore in the company. Earlier in November, Tiger Global offloaded a total of 1,34,17,607 shares, amounting to a 2.98 per cent stake in PB Fintech for Rs 522 crore.
Financials
Recently, PB Fintech reported its March quarter earnings where its losses narrowed from a year ago. It reported a loss of Rs 8.95 crore from Rs 219.60 crore in the same quarter a year ago. Revenue from operations came in at Rs 869.09 crore, up 60.85 percent from Rs 540.29 crore in the corresponding quarter last year.
Post these numbers, many brokerages were bullish on the stock and raised their price target for the stock. JM Financial has raised its target price for the stock by 58 percent to Rs 980 per share and maintained a buy rating. Citi has set a target price of Rs 820, while Morgan Stanley values the stock at Rs 810. Additionally, CLSA estimates the value of the scrip to be Rs 720.
"The company is now the most dominant insurance distributor in the country with our estimates suggesting Policybazaar accounting for 42 percent of online insurance distribution while also becoming the largest PoSP player. We have maintained our revenue forecasts for the company and brought forward PAT level profitability to FY24 itself, resulting in a DCF-based TP of Rs 980. However, our steady state profitability remains similar and earlier margin improvement implies a slower uptick in the later years," JM Financial said in a note to investors.
