M&M Financial Services - Current Valuations Attractive; Risk-Reward Favorable: Motilal Oswal
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Motilal Oswal Report
Key takeaways from Mahindra and Mahindra Financial Services Ltd.’ pre-quarterly release:
Mahindra Finance reported December 2021 disbursements of Rs 27.5 billion (up 42% YoY). The company’s Q3 FY22 disbursements stood at Rs 79.8 billion (up 27% YoY/23% QoQ). Its nine months-FY22 disbursements rose 41% YoY to Rs 183 billion.
The company’s Q3 FY22 collection efficiency declined 300 basis points QoQ but improved 700 bp YoY. Collection efficiency improved to 100% in Dec-21 from 94% in November 2021. Its collection efficiency stood at 95% in Q3 FY22 (versus 98% QoQ and 88% YoY).
Mahindra Finance reported a month-on-month reduction in both stage-II and stage-III in Dec-21. This reduction was after two consecutive months, wherein the stage-III either remained rangebound or stable. The company reiterated that it will bring the net stage-III below 4% by March 2022.
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