Manapuram Finance Limited reported on 12 May 2023 that its consolidated net profit for the quarter ended 31 March 2023 increased by 58% to Rs 413 million. The company reported a consolidated profit of Rs 261 million a year ago. The Board of Directors of the Company has announced an interim dividend of Rs.75 per share with a par value of Rs.2.
Shares of Manapuram Finance Limited rose 3% in early trading after strong fourth-quarter results. As of 9:40 am, shares of Manapuram Finance were trading 2.23% higher at Rs 112.45 on the NSE.
Manapuram Finance reported on May 12, 2023 that its consolidated net profit at the end of the March quarter was Rs 413 million, up 58% from Rs 261 million a year ago. The Board of Directors of the Company announced an interim dividend of Rs.75 per share at a par value of Rs.2.
Kerala-based NBFC’s total revenue amounted to Rs 1,771 million, representing an increase of 19% compared to Rs 1,481 million for the same period last year. Profit before tax from the gold loan business, which accounts for three-quarters of total profit, increased by 16 per cent to Rs 422 million. Meanwhile, the company’s microfinance division posted a pre-tax profit of Rs 144 million against a loss in the same period last year.
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However, Manapuram’s gold loan assets under management fell 2% year-on-year as rising gold prices reduced the collateral needed by borrowers to borrow money. The company’s gold loan customer portfolio increased by 0.4% year-on-year.
CLSA has given Manapuram Finance a buy rating with a target price of Rs 140 per share. Poor results, with after-tax earnings falling 5% below expectations in the fourth quarter of fiscal 2023, will boost the stock. This failure was solely caused by the 8% Net Interest Margin (NII). Management attributed this to lower gold loan yields due to extended lending terms after two quarters of declining gold loans, and Manapuram achieved 6% quarter-on-quarter growth. Regarding the recent ED investigation, management said the High Court issued a cease and desist order.
BofA has a price target of Rs 143 per share for Manapuram Finance. Earnings are in line with forecasts on the back of a strong fiscal year 2024, according to the company, and profitability and growth in non-gold are improving. The company said it was confident the High Court would suspend the ED’s executive order at a hearing on Friday and reverse the order at a future hearing.
Morgan Stanley has given Manapuram Finance an overweight rating and a price target of 160 rupees per share. The lending growth the company showed was a positive surprise. Yields on gold loans have fallen due to the shift to longer-term loans, but should gradually recover, according to management. Asset quality and Ashirvad’s performance were strong, brokerages said.
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