Jefferies mentioned that in its interaction with the company's management suggested that provisions should stabilize as stress in wholesale 1.0 has largely been recognised.
Growth is strong in the retail franchise and should drive a 15 percent loan Compounded Annual Growth Rate (CAGR) over financial year 2023-2026, according to Jefferies. The brokerage expects the recovery in profitability to be gradual due to elevated operational expenditure intensity.
“At 0.6x FY24 BV, we see a favourable risk reward,” Jefferies noted.
After exiting its healthcare business, Piramal group held huge cash on its books and increased its presence in the financial services segment.
It picked up stakes in several Shriram group companies about ten years ago. Piramal bought a stake in Shriram Transport in 2013, and in Shriram Capital in the following year. In 2018, it bought another stake in Shriram City Union Finance.
Shares of Piramal Enterprises ended 2.5 percent higher at Rs 905.50.
