Five Star Business Finance, a non-banking finance company, Q4 performance has been impressive so far, with strong disbursement growth. This is a positive sign for the company, as disbursements are a key driver of growth in the non-banking finance sector.
In an interview with CNBC-TV18, Lakshmipathy Deenadayalan, CMD of the financial institution, said that March would be the best quarter for Five Star in terms of performance.
He said, “Q4 shows very strong business growth, both in disbursement and logins, we are seeing one of the best quarters. March quarter will be the best among the best of Five Star.”
He also expects the difference between actual gross non-performing assets (GNPAs) and guidance to be lower than the previously projected range of 75-100 basis points (bps). This is a positive sign, as a lower GNPA indicates a healthier loan portfolio and improved asset quality.
Deenadayalan also said that the game is moving from return on assets (ROA) to return on equity (ROE). This shift is significant because it reflects a focus on profitability rather than just growth. By prioritising ROE, companies are looking to maximize their returns on investment and generate more value for their shareholders.
Also, Nuvama, an investment and financial services company, has initiated coverage on the stock with a buy rating and target of Rs 710. Nuvama is expecting assets under management CAGR of 30 percent over FY22-25 and a high return on assets (ROA) of 8 percent.
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