Buy Manappuram Finance, target price Rs 150: Motilal Oswal Securities

Motilal Oswal Securities has buy call on Manappuram Finance with a target price of Rs 150. The current market price of Manappuram Finance is Rs 111.4.

Manappuram Finance, incorporated in the year 1992, is a Mid Cap company (having a market cap of Rs 9513.48 Crore) operating in NBFC sector.

Manappuram Finance key Products/Revenue Segments include Interest, Other Operating Revenue, Fees & Commission Income for the year ending 31-Mar-2022.


Financials
For the quarter ended 31-12-2022, the company has reported a Consolidated Total Income of Rs 1734.52 Crore, up 1.19 % from last quarter Total Income of Rs 1714.12 Crore and up 15.11 % from last year same quarter Total Income of Rs 1506.85 Crore. Company has reported net profit after tax of Rs 393.49 Crore in latest quarter.

The company’s top management includes Mr.Shailesh Jayantilal Mehta, Mr.V P Nandakumar, Mr.Abhijit Sen, Mr.Gautam Narayan, Mr.P Manomohanan, Mr.V R Ramachandran, Mr.Harshan Kollara, Mr.S R Balasubramanian. Company has S K Patodia & Associates as its auditors. As on 31-03-2023, the company has a total of 85 Crore shares outstanding.

Investment Rationale
The company trades at 0.8x FY24E P/BV. While there could be near-term volatility in the stock price, we would monitor the legal proceedings in the case very closely. Any clarifications from the regulators or other authorities will be keenly watched.

The brokerage models a consolidated AUM CAGR of ~18% over FY23-25E withconsolidated RoA/RoE of ~4.0%/18% over FY25E.

Promoter/FII Holdings
Promoters held 35.2 per cent stake in the company as of 31-Mar-2023, while FIIs owned 30.17 per cent, DIIs 13.54 per cent.