Buy Poonawalla Fincorp, target price Rs 445: JM Financial

JM Financial has buy call on Poonawalla Fincorp with a target price of Rs 445. The current market price of Poonawalla Fincorp is Rs 293.85. Time period given by analyst is 1 year when Poonawalla Fincorp price can reach defined target.

Poonawalla Fincorp, incorporated in the year 1978, is a Small Cap company (having a market cap of Rs 22831.08 Crore) operating in NBFC sector.

Poonawalla Fincorp key Products/Revenue Segments include Interest, Fees & Commission Income, Rental Income, Income From Sale Of Share & Securities for the year ending 31-Mar-2022.


Financials
For the quarter ended 30-09-2022, the company has reported a Consolidated Total Income of Rs 654.89 Crore, up 14.56 % from last quarter Total Income of Rs 571.67 Crore and up 27.76 % from last year same quarter Total Income of Rs 512.58 Crore. Company has reported net profit after tax of Rs 163.12 Crore in latest quarter.

The company’s top management includes Mr.Adar Cyrus Poonawalla, Mr.Sanjay Kumar, Mrs.Vijayalakshmi Iyer, Mr.Prabhakar Dalal, Mr.Bontha Prasada Rao, Mr.Atul Kumar Gupta, Mr.Amar Deshpande, Mr.Sajid Fazalbhoy, Mr.Abhay Bhutada, Mr.G Jaganmohan Rao. Company has Walker Chandiok & Co. LLP as its auditors. As on 30-09-2022, the company has a total of 77 Crore shares outstanding.

Investment Rationale
As growth delivery plays out, the brokerage sees the company's valuation multiples rerating higher over the medium-term. JM Financial's revised target price of Rs 445 values the company at 3.5x Mar-24e post-txn BVPS (of INR 128), given the accretion to the net worth due to the transaction. Poonawala is among the brokerage's top picks in the NBFC space.

Promoter/FII Holdings
Promoters held 61.48 per cent stake in the company as of 30-Sep-2022, while FIIs owned 7.35 per cent, DIIs 4.64 per cent.