Mahindra Finance shares crack 4% after hitting 52-week high; brokerages mixed

Mahindra Finance Share Price: Shares of Mahindra & Mahindra Financial Services Limited on Tuesday, January 3, hit fresh 52-week high of Rs 247 on NSE and Rs 247.05 on BSE on the back of heathy disbursement numbers in December.

The stock, however, surrendered the gains due to profit booking. At 12:40, it traded in negative bias to quote Rs 231.25 apiece on NSE, down by more than 3 per cent. 

According to a business update shared by the Mumbai-headquartered company yesterday, in December 2022, on the backdrop of positive macro environment, the business continued its momentum with disbursement of approximately Rs 4,650 crores delivering a 67 per cent Y-o-Y growth. 

The Q3 disbursements at approximately Rs 14,450 crores registered a growth of 80 per cent Y-o-Y. The YTD disbursement of approximately Rs 35,750 crores registered a Y-o-Y growth of 95 per cent. It said that the Collection Efficiency (CE) was at 98 per cent for December 2022. The current quarter’s CE was similar to that of last year at 95 per cent. Stage-3 and Stage-2 assets have seen sequential improvement in the current month and quarter. Stage 3 assets are expected at approximately 6.2 per cent and Stage 2 assets at approximately 8.5 per cent as at December end.

The company continued to maintain comfortable liquidity chest of about 4 months’ requirement, it said. 

Mahindra Finance Share Price Target 2023

Global brokerage firm Jefferies in its report has maintained underperform rating on Mahindra Finance with a price target of Rs 175. It said that the company's assets rose by almost 20 per cent year-on-year to Rs 770 billion, however, a bit softer than estimated.

Morgan Stanley, on the other hand, has tagged maintained overweight rating on Mahindra & Mahindra Financial Services Limited with a target price of Rs 275. 

Meanwhile, Zee Business panellist and market expert Avinash Gorakshakar said that the stock is currently at good level. He said that its asset quality is improving and exuded confidence that the company's third quarter result will be good. He noted that the rural demand is increasing and that disbursement and profitability will improve further.

Existing shareholders can hold the stock, he said, adding that one can buy the shares of Mahindra Finance on dips. Mahindra & Mahindra Financial Services Limited is amongst the top tractor financers in India, with 1000 plus offices across the country. 

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