Manappuram Finance Q4 Review - Change In Loan Tenure Impacted Yields; Outlook Remain Positive: Systematix

BQ Prime’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer BQ Prime’s subscribers an opportunity to expand their understanding of companies, sectors and the economy. .Systematix Research Report.Manappuram Finance Ltd.’s Q4 FY23 operating performance was below expectation as increase in tenure of gold loan portfolio led to lower penal interest income, impacting yields in that portfolio. On all other parameters like assets under management growth and asset quality, the performance was better than expected. Growth in Gold portfolio bounced back, aided by higher gold price. Non-gold portfolio also grew by a strong 55% YoY led by microfinance, commercial vehicle, home loan, micro, small and medium enterprise and others. Micro finance institution business (26% of the AUM) contributed meaningfully with AUM growth at +40% YoY (+15% QoQ), improved asset quality (2.7% versus. 6.7% in Q3 FY23) and improved profitability (Rs 993 million versus 706 million in Q2 FY23). We estimate a 22% compound annual growth rate in Manappuram Finance’s AUM to deliver a 25% CAGR in earnings over FY23-FY25E. With optimal product mix along with improving asset quality and expansion in the MFI business, Manappuram Finance should be able to improve their return on asset/return on equity to 4.3%/19.3% by FY25E from 4.1%/16.6% in FY23, respectively. On the recent Enforcement Directorate raid, the management commented that they have got the stay order on ED operations and expect the case to get quashed soon. Key risk: Any negative development in ED case can impact the borrowing capability of the firm..Click on the attachment to read the full report:.DMart Q4 Results: Profit Up 8%, Higher Costs Dent Margin.DISCLAIMERThis report is authored by an external party. BQ Prime does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of BQ Prime..Users have no license to copy, modify, or distribute the content without permission of the Original Owner.

Manappuram Finance Q4 Review - Change In Loan Tenure Impacted Yields; Outlook Remain Positive: Systematix

On the recent ED raid, management commented that they have got the stay order on ED operations, expect case to get quashed soon.

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