Sharekhan has given Buy recommendation for Spandana Sphoorty Financials with a target price of Rs. 850 in its research report issued on Feb 09, 2021
Sharekhan’s research report on Spandana Sphoorty Financials
Spandana Sphoorty Financials Limited (SSFL) posted weak results for Q3FY2021 with operational numbers coming below expectations; however, pickup in disbursement was encouraging. Asset-quality performance mixed, with Q3 seeing large write-off of Rs. 212 crore, which made PAT miss estimates. However, collection efficiency (CE) at 96% and is nearing pre-Covid levels. A diversified book with no district having more than 1.5% of AUM and no branch more than 1% of AUM augurs well; SSFL trades at 1.6x / 1.3x its FY2022E/FY2023E BVPS, which we believe are reasonable.
Outlook
We maintain Buy with an unchanged PT of Rs. 850.
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