Buy Equitas Holdings Ltd., target Rs 235 : Angel Broking

Angel Broking has Buy call on Equitas Holdings Ltd. with a target price of Rs 235.0. The current market price of Equitas Holdings Ltd. is 176.85. Time period given by analyst is year, when Equitas Holdings Ltd. price can reach defined target. Angel Broking says Equitas is strongly positioned to grow on the back of its balanced portfolio. Conversion to a SFB will have its own challenges. However, the market segment which the upcoming bank intends to cater to has vast untapped business potential and exploiting it effectively will drive the company’s growth for multiple years. Despite costs having to be incurred in order to meet regulatory requirements (SLR + SRR), we believe the company will be able to deliver a ROA of 2.5% and ROE of 11.5% by FY2018. At the current market price the stock is trading at 2.3x its FY2018E BV of Rs 75.6.