CreditAccess Grameen Ltd. share price target

We maintain our BUY recommendation on the stock and value CAG at 2.5x H1FY24E BV to arrive at a target price of Rs 825/share, implying an upside of 13% from CMP.

Stellar quarter; Beat on all counts

CA Grameen’s journey from being a project under T Muniswamappa Trust (TMT) in 1999, an NGO in South Bangalore, to becoming the largest NBFC-MFI in India as on Sep’21 with consolidated AUM of Rs133bn and borrower base of 3.75mn is testimony of its resilient business model. It has been successfully navigating many challenging events like AP crisis, demonetisation and two covid waves.

We recommend a BUY on the stock and value CAG at 2.3x H1FY24E BV to arrive at a target price of Rs 715/share, implying an upside of 37% from CMP.

We maintain our BUY recommendation on the stock and value CAG at 2.4x H1FY24E BV to arrive at a target price of Rs 755/share, implying an upside of 26% from CMP. We believe that our target multiple reflects the superior return profile (~16% ROE by FY24E), large growth opportunity in the rural market

In-line quarter with asset quality better than peerset

We maintain our BUY recommendation on the stock and with a target price of Rs 745/share, implying an upside of 12% from CMP.

We value CAG at 2.5x FY23E BV and believe that our target multiple reflects the superior return profile (achieving ~16% ROE by FY23E and improving thereafter) and the inherent risks in the MFI business.

CreditAccess Grameen Limited (CAGL) is one of the leading Microfinance NBFCs in India with high focus on Group lending and Retail finance with majority of its operations in South India. Gross Loan Portfolio (GLP) declined 7% on sequential basis to...

We value CAG at 2.5x FY23E BV and believe that our target multiple mirrors the superior return profile (~16% ROE by FY23E) and the inherent risks in the MFI business. We maintain a BUY recommendation on the stock with a revised target price of Rs 745/share, implying an upside of 23% from CMP.