We recently met management of Capital First (CAFL) at our Midcap Conference'. The company's growth prospects appear bullish to us. Given the strong performance in 1HFY18, coupled with better-than-expected demand in the festive season, AUM growth in FY18 should comfortably exceed management's guidance of 23-25% and could possibly be north of 30%, in our view. We expect 28% AUM growth, driven by growth of 50% in consumer durables (CD) loans and 30% in twowheeler (2W) loans. Management targets a 400-500bp improvement in RoE over three years from FY17 levels (12%). There are three key factors driving this improvement: (1) Improving...