Target: ₹820
CMP: ₹774.85
The AUM of Cholamandalam Investment and Finance Company (CIFC) grew strongly at 8.9 per cent q-o-q/31.3 per cent y-o-y to ₹95,468 crore, led by strong disbursements — up 19.8 per cent q-o-q. Vehicle finance (64.2 per cent of AUM) grew 6.4 per cent/20.9 per cent q-o-q/y-o-y. Loan against property (20.9 per cent of portfolio) grew 6.1 per cent/18.2 per cent q-o-q/y-o-y and new business including home loans grew 26.4 per cent/176.3 per cent q-o-q/y-o-y. New businesses and home loans’ share in AUM mix is up to 14.9 per cent in Q3 23 from 12.8 per cent in Q2 23. NIMs remained flat on a q-o-q basis at 7.77 per cent.
CIFC’s AUM growth is expected to be driven by three new businesses: Consumer and small enterprise loans; secured business and personal loans; and small and medium enterprise loan business financing etc. The new businesses, launched last year, saw exponential growth, recording disbursements of ₹3,780 crore, up 20.7 per cent q-o-q.
We maintain ‘Buy’ rating and increase our TP to ₹820 (4.4x on September 24E PABV) from ₹792 (earlier:4.2x September 24E PABV). We have increased our multiple as company is scaling up its new business verticals very strongly and vehicle demand is also strong. .
Comments
Comments have to be in English, and in full sentences. They cannot be abusive or personal. Please abide by our community guidelines for posting your comments.
We have migrated to a new commenting platform. If you are already a registered user of TheHindu Businessline and logged in, you may continue to engage with our articles. If you do not have an account please register and login to post comments. Users can access their older comments by logging into their accounts on Vuukle.