Shriram Finance Ltd. share price target

Maintain BUY with a TP of Rs 1,773 (2.5x Mar-20E ABV of Rs 709). Post a stellar show in FY18, SHTF delivered robust growth (+22% YoY) yet again. New CVs were the primary driver, clocking a growth of ~62% YoY. Asset quality was largely stable as GNPAs grew merely ~1% sequentially. NIMs remained sticky at 7.44% despite the jump in CoF as yields provided some support.

Shriram Transport Finance Company (STFC) has been showing consistent improvement on operational front led by strong growth in disbursement over last few quarters and strong bottom-line growth under Ind-AS reporting. Its disbursement grew by 24.1% YoY and 11.2% QoQ to Rs134.3bn in 1QFY19 owing to strong growth in new CV financing segment (+78.5% YoY and 21.7% QoQ) and healthy growth in used CV segment (+16.1% YoY & 8.5% QoQ). Consequently, AUM improved by 22.3% YoY to Rs1,010bn. AUM under newly introduced Ind-AS remained almost stable at 7.4% led by better ALM management. As a result, STFC's operating profit grew by 16.5% YoY to Rs14.1bn. Further, provisioning grew by just 4.4% YoY led by lower requirement...

Shriram Transport Finance Company Limited (SHTF) reported strong set of numbers in its Q1FY19 registering a revenue, net profit and AUM above our estimates.

Shriram Transport Finance's annual report of 2017-18 disclosed an off balance sheet exposure of | 871 crore provided to group company SVL Ltd (erstwhile Shriram Industrial Holding Ltd). This was earlier a loan. The same was transferred to another lender by STFC and converted into a guarantee by STFC as off balance sheet. Also, the corporate guarantee...

Shriram Transport Finance Company's (SHTF) in its FY18 annual report, has disclosed an off-balance sheet exposure of INR 8.7 bn, as a corporate guarantee for Shriram Venture.

Shriram Transport Finance Company Limited (SHTF) reported a very healthy growth in revenue, operating profit, AUM while net profit de-grew marginally due to...

Growth perks up, worst of assets quality is behind; Maintain BUY Shriram Transport Finance Company (STFC) has been showing consistent improvement mainly on operational front led by highest growth in the disbursement over last few years along with strong growth in operating profit. Its disbursement grew by 43.8% YoY and 13% QoQ to Rs151bn owing to strong growth in new CV financing business and healthy growth in used CV segment. Consequently, AUM improved by 21% YoY and 5.9% QoQ to Rs953bn. Reported NIM on AUM remained almost stable at 7.5% QoQ (+55bps YoY) led by decline in cost of fund. As a result, STFC's operating profit grew by 24.3% YoY and 5.3% QoQ to Rs14.2bn. However, headline asset...

Maintain BUY with a TP of Rs 1,842 (2.75x Dec-19E ABV of Rs 670). SHTFs incredible growth continued in 4QFY18, as robust disbursements (+44% YoY) eclipsed the shift to 90DPD (GNPA hit 9.15%). NIM held at 7.52%, +4bps QoQ despite a higher share of (lower yielding) new vehicles and interest reversals (Rs 272mn). The business loans book (Rs 26bn) is now at critical mass and holds long term promise, in our view.

For SHTF, 4QFY18 was marked by better-than-expected AUM growth, margin expansion and high provisioning expenses. This biggest positive surprise in the quarter was AUM growth of 21% YoY -the highest in 18 quarters. Overloading ban in some markets, coupled with a pick-up in infra activities, led to strong AUM growth. Growth was broad-based, with 17% YoY growth in used CV loans and 37% YoY growth in new CV loans. Management guided for 18% YoY AUM growth inFY19.

Shriram Transport Finance's (SHTF) delivered robust operating performance in Q4FY18 with NII growth of ~38.1% yoy (14.3% qoq) at Rs19.8bn, supported by disbursement growth of ~43.8% yoy (+13% qoq) and AUM growth of 21% yoy (~5.9% qoq) to Rs953.1bn Operating profits growth was robust at ~36.6% yoy with healthy NIMs at 7.52% and one off gain from stake sale in Shriram Automall of Rs1.39bn; elevated provisions due to...