154.50 -1.15 (-0.74%)
6.7M NSE+BSE Volume
NSEMay 07, 2021 03:31 PM
The 16 reports from 8 analysts offering long term price targets for Mahindra & Mahindra Financial Services Ltd. have an average target of 218.38. The consensus estimate represents an upside of 41.35% from the last price of 154.50.
|Summary||Date||Stock||Broker||Price at Reco.||Target||Price at reco|
Change since reco(%)
|2021-04-26||Mahindra & Mahindra .. +||Nirmal Bang Institutional||163.25||203.00||163.25 (-5.36%)||31.39||Accumulate|
Nirmal Bang Institutional
Mahindra Finance (MMFS) reported 8% decline in loans to Rs599bn in FY21 due to a 41% decline in disbursements. MMFS lost market share across segments with issues at M&M; affecting UV and Tractor disbursements, which were down 31% and 30% in FY21. Entry into digital consumer lending (CD, PL & 2W) is positive as MMFS has an advantage of a large customer base and huge data around their income levels and repayment track record. However, execution remains the key given the less-secured/unsecured nature of lending to the borrowers with no formal source of income and high dependence on agri/rural economy. NIM for FY21 expanded by 76bps due to high interest yields (up 60bps at 16.4%) and low cost of funds (down 60bps at 8%). MMFS continues to hold Covid provisions of Rs10bn and created additional provisions of Rs13.2bn to...
|2021-04-26||Mahindra & Mahindra .. +||ICICI Securities Limited||163.25||160.00||163.25 (-5.36%)||Target met||Sell|
ICICI Securities Limited
Mahindra & Mahindra Financial Services (MMFS) reported a mixed set of Q4FY21 numbers wherein topline growth improved on account of better margins but lower disbursements led to slower AUM growth. NII increased 12.2% YoY, 9.2% QoQ to | 1511 crore on the back of improvement in NIMs (calculated) that were up 63 bps QoQ, 35 bps YoY to 7.4% owing to slightly better asset quality and liquidity management. Employee cost increased 32% YoY to | 282 crore, mainly on account of lower base effect due to reversal of provisions on incentives YoY. Credit cost...
|2021-04-25||Mahindra & Mahindra .. +||Motilal Oswal||163.25||215.00||163.25 (-5.36%)||39.16||Buy|
The GS 2/3 loan ratio declined 150bp/100bp QoQ to 12.5%/9%. The company reduced Stage 1/2 provisions by 100bp to 2%, but increased Stage 3 provisions to 58% (from 37% QoQ). The number of customers that had not made a single payment during the quarter declined to ~47k in 4Q from ~90k in 3Q. Also, only INR3b ECLGS and INR0.5b restructuring were undertaken during the quarter. MMFS had ~INR58b GNPLs pre-COVID and has ~INR58b GNPLs currently. However, it had only ~INR25b total provisions pre-COVID, while it has...
|2021-03-25||Mahindra & Mahindra .. +||Prabhudas Lilladhar||199.90||200.00||199.90 (-22.71%)||Target met||Hold|
Upgrade MMFS to HOLD (earlier REDUCE) on higher EPS expansion Our channel checks indicate that commercial vehicle (CV) finance business is expected to accelerate on the back of healthy demand conditions, anticipated improvement in supply chain and resilient balance sheets of financiers. They suggest (a) disbursements stand 80% of last year levels; ECLGS provides some boost (b) regulatory dispensations (restructuring/ ECLGS) mask true asset quality picture, but CV financiers' balance sheets remain resilient (c) new business asset quality intact, stress in seasoned...
|2021-02-10||Mahindra & Mahindra .. +||Geojit BNP Paribas||205.45||201.00||205.45 (-24.80%)||Target met||Hold|
Geojit BNP Paribas
Strong balance sheet and excess liquidity position are the key catalysts to derive growth. Additionally rising demand from rural sector, encouraging effort on cost optimization should support growth prospectus. However, we skeptical on the stock on uncertainty evolving around economy. Therefore, we downgrade our rating to HOLD on the...
|2021-01-31||Mahindra & Mahindra .. +||Nirmal Bang Institutional||161.45||178.00||161.45 (-4.30%)||Target met||Buy|
Mahindra Finance- 3QFY21 Result Update- Asset quality stress affects profitability; growth disappointing
Nirmal Bang Institutional
Asset quality stress affects profitability; growth disappointing Mahindra Finance (MMFS) reported 5% YoY decline in loans at Rs621bn due to a 49% YoY decline in disbursements in 9MFY21 (down 36% YoY in 3QFY21). AUM declined across segments, except UV & Cars while disbursements were down for all (ex-SME & other segments; 6% of AUM). Net interest income (NII) at Rs13.8bn was 7% below our estimate largely due to decline in loans while calculated NIM expanded by 25bps YoY due to low cost of funds. Operating profit was in line with our estimate at Rs10bn, led by low operating expenses as the business activity remained tepid. MMFS reported Rs14bn in provisions, way ahead of consensus and our estimates. Negligible...
|2020-10-28||Mahindra & Mahindra .. +||ICICI Securities Limited||121.35||140.00||121.35 (27.32%)||Target met||Hold|
ICICI Securities Limited
Credit costs continued to remain elevated at | 619 crore (~76 bps of AUM), including Covid-19 provision of | 433 crore. This took outstanding Covid provision to | 910 crore (i.e ~111 bps of advances). Asset quality improved with GNPA ratio (with standstill asset norms) at 7.03% vs. 7.88% in Q2FY20 and 8.44% in Q1FY21. Excluding standstill asset classification, GNPA ratio came in at 7.53%, down ~91 bps QoQ. Collection efficiency for September 2020 improved to ~82%, though it was still below pre-Covid level. The management remained focused on cost rationalisation announced...
|2020-10-27||Mahindra & Mahindra .. +||Prabhudas Lilladhar||121.35||124.00||121.35 (27.32%)||Target met||Sell|
Reported provisions continue to lag our conservative forecasts prompting us to tweak FY21 earnings estimates higher by 58%. Subsequently, our FY22-23 estimates stand slightly higher by 5-10%. While Q2FY21 NPA at 7.5% stood optically better, higher write-offs and couple of granular asset details continue to throw negative surprises, viz, (a)8% (Rs50bn) critical assets (b)17% of overall customer base not paying even a single installment, o/w 6% could be restructured (c)Rs60bn book potential restructured book; Rs40bn...
|2020-10-27||Mahindra & Mahindra .. +||Motilal Oswal||121.35||165.00||121.35 (27.32%)||Target met||Buy|
Mahindra Finance (MMFS)'s 2QFY21 PAT was up 21% YoY to INR3b (a 64% beat and v/s INR1.5b QoQ). While PPoP was largely in line with est., lower provisions of INR6.2b (v/s est. INR8b) led to the PAT beat. PPoP grew 26% YoY to INR10.3b as opex declined 24% YoY to INR3.9b. Decline in opex was largely driven by 46% YoY decline in other expenses. Value of Assets (VOA) financed stood at INR54b (down 45% YoY). In the Auto/UV and Tractor segments, VOA was down just 2223% YoY, and in other segments, it was down 6585% YoY. While we acknowledge the...
|2020-07-20||Mahindra & Mahindra .. +||Yes Securities||227.90||290.00||227.90 (-32.21%)||87.70||Buy|
Lower disbursements (VAF down 67% yoy) and collections (75% of customers under moratorium) directly suppressed large cost components like travelling, commissions and conveyance. Renegotiation of fixed costs (rentals, outsourced services, etc.) and reduction in discretionary costs (advertising, etc.) also pulled down the opex. On-roll manpower has been...
|2020-07-20||Mahindra & Mahindra .. +||Motilal Oswal||227.90||320.00||227.90 (-32.21%)||107.12||Buy|
20 July 2020 Mahindra Finance (MMFS) reported 1QFY21 PAT of INR1.6b (up 128% YoY; down 29% QoQ), a 3% miss. While PPoP beat our estimates by 25%, higher-than-expected provisions at INR8.4b led to the modest PAT miss. While the value of assets financed declined sharply, we note the decline in Tractors was much lower (35% YoY). Around half of the opex cut is sustainable, as per management. Gross Stage 3 assets increased 75bp QoQ to 9.2% due to slippages from tractor owners who had not availed moratorium. provision coverage to 40% QoQ from 31%. ECL% increased to 5.5% v/s 4.4% in 4QFY20 and 3.6% in 1QFY20. MMFS is comfortable on the ALM front, with liability repayments of INR54.7b in 2QFY21, against a cash balance of INR85b.
|2020-07-10||Mahindra & Mahindra .. +||Keynotes Financial Opiniery||201.70||250.00||201.70 (-23.40%)||61.81||Buy|
Keynotes Financial Opiniery
MMFSL is one of leading Non-banking Finance Companies (NBFCs) with customers primarily in the rural and semi urban markets of India. MMFSL benefits from its close relationships with dealers & its longstanding relationships with original Equipment Manufacturers (OEMs) which allow it to provide on -site financing at dealerships. MMFSL is primarily engaged in providing financing...
|2020-05-18||Mahindra & Mahindra .. +||ICICI Securities Limited||134.60||160.00||134.60 (14.78%)||Target met||Hold|
ICICI Securities Limited
Credit cost came in substantially higher at | 674 crore including contingent provision of | 574 crore related to Covid. Amid Covid, seasonal improvement in asset quality in Q4 was absent with GNPA remaining stable at 8.4%. Consequently, PAT declined 62% YoY to | 220.9 crore. Collection efficiency dipped to ~15% in April 2020, improving in May to ~30%. Also, ~75% customers opted for moratorium while ~28-30% branches/ customers are in red zone. Management expect any normalisation in business volumes to happen only post October 2020 with initial traction in...
|2020-05-17||Mahindra & Mahindra .. +||HDFC Securities||137.80||228.00||137.80 (12.12%)||Target met||Buy|
Mahindra & Mahindra Financial Services (4QFY20): Pain inevitable, valuations attractive. Maintain BUY
Inexpensive valuations underpin our BUY (TP of Rs 228, 1.4xFY22E ABV + Rs 18 for stake in MIBL) MMFS business and asset quality performance, and consequently earnings were hit by COVID-19, despite 4Q being a seasonally strong qtr. Operating performance is likely to be subdued in the near term. Elevated provisions are likely to persist, weighing down on earnings. A deep rural presence, capable collection infrastructure (as seen in the past) and relatively easy access to funds are positives.
|2020-05-16||Mahindra & Mahindra .. +||Motilal Oswal||168.45||200.00||168.45 (-8.28%)||Target met||Buy|
16 May 2020 MMFS 4QFY20 PAT of INR2.2b (down 62% YoY), a 40% miss. The miss in PAT was led by a contingency provision of INR5.7b (we factored in ~INR2.2b) related to COVID-19. Of INR5.7b, INR4.7b was used to increase PCR (800bps QoQ to 31%) for GNPA. Pre-provisioning profits grew 24% YoY (beat of 14%) to INR9.7b as opex (27% beat) declined 24% YoY to INR4.2b. Net income missed our estimate by 3% as loans stood largely flat QoQ (+6% YoY) at INR650b v/s the expectation of ~2% QoQ growth (on March- end COVID-19 restrictions). NIMs/GS3% came in flat QoQ at 7.7%/8.4%.
|2020-05-16||Mahindra & Mahindra .. +||Prabhudas Lilladhar||136.70||171.00||136.70 (13.02%)||Target met||Sell|
30% in red zone) should further weigh down on asset quality and earnings over FY21-22. Consequently, GNPA & credit costs estimates stand marginally tweaked to (7-8% vs 7.5% earlier and 2.4%+ vs 2.3% earlier resp.) prompting to trim EPS estimates by 2-8% over FY21-22E. With return profile (RoE: 9%/RoA:1.2%) offering no respite, we reiterate REDUCE rating with SoTP...
|2020-04-30||Mahindra & Mahindra .. +||Geojit BNP Paribas||165.95||191.00||165.95 (-6.90%)||Target met||Buy|
Geojit BNP Paribas
MMFS looking at converting its 85 regional offices to 4-5 large service centers in order to reduce fixed expenses, along with other measures. We revise our estimates for FY20-22E and arrive at a target price of Rs....
|2020-02-04||Mahindra & Mahindra .. +||Geojit BNP Paribas||398.05||416.00||398.05 (-61.19%)||Buy|
Geojit BNP Paribas
NII grew 13.4% YoY/ 6.8% QoQ, due to reduction in borrowing cost. Provisions increased 78.1% YoY/10.9% QoQ, due to extra provisioning given challenging economic conditions Asset quality remained under pressure as GNPA/NNPA ratio declining sequentially at 7.6%/6.0% in Q3FY20 (vs 7.2%/5.8% in Q2FY20). We rolled forward the valuation to FY22E and arrive at a target price of Rs. 416 based on SOTP, retain our BUY rating on the stock. NII aids bottom line, partially offset by higher provisions...
|2020-01-29||Mahindra & Mahindra .. +||HDFC Securities||368.20||425.00||368.20 (-58.04%)||Buy|
The extent of deterioration in asset quality was surprising, given the usual seasonal trends and the creditable progress made by MMFS until now. NIM improvement and growth trends were positives. As always, MMFS' performance is highly correlated with rural macros. MMFS stands to gain from any improvement here. MMFS 3Q earnings were slightly ahead of estimates, even as provisions remained elevated YoY (+11% QoQ). NIMs expanded QoQ after a prolonged fall and AUM growth was healthy. The increase in GS-III disappointed. Maintain BUY with a TP of Rs 425 (2.25x Dec-21E core ABV of Rs 181 + Rs 18 for MIBL)
|2020-01-28||Mahindra & Mahindra .. +||Motilal Oswal||368.20||420.00||368.20 (-58.04%)||Buy|
28 January 2020 MMFS reported 3QFY20 PAT of INR3.7b (+15% YoY) a 6% miss. Better- than-expected margins (NII beat of 6%) and opex performance (4% beat) led to PPoP beat of 13%. However, contingency provision (for customers who have a prolonged default history) of INR940m led to a PBT miss of 4%. Adjusted for the same, the PBT beat was 14%. (a) Loans were up 2.5% QoQ/12% YoY. (b) Spreads were up 10bp QoQ (9M v/s 1H). (c) Asset quality disappointed with GS3% up 60bp QoQ to 8.5%. (d) Share of securitization in borrowings increased to 15% from 12% last quarter. MMFS remains comfortable on the funding side. However, near-term growth challenges will remain with pressure in the underlying segment. We cut our estimates by 5% (led by higher provisions) and factor in ~13% AUM CAGR with RoA/RoE of 2.2%/15%.