Shriram Finance Share Price: Sneha Poddar, VP-Research, Wealth Management at Motilal Oswal Financial Services, said that Shriram Finance has outperformed
the markets consistently and her advise will to book partial profit after the recent rally following the news of MUFG Bank's investment. Notably, Shriram Finance last week approved the sale of a 20 per cent stake to the Japan-based MUFG Bank for an investment of Rs 39,618 crore (about USD 4.4 billion) through a preferential issuance of equity shares. Responding to a query on Shriram Finance, Sneha said that Shriram Finance shares have jumped more than 10 per cent since the deal was announced and zoomed more than 50 per cent in just three months. She said that the MUFG deal will strengthen the NBFC's capital base and accelerate its growth trajectory. She added that the deal also reinforces confidence in India's lending and financial services sector fundamentals and future growth potential. Sneha said that her recommendation will be to book partial profit in Shriram Finance around Rs 1000 and hold the remaining positions. "I would recommended booking partial profit in Shriram Finance around Rs 1000. The recent development about MUFG buying a stake of 20 per cent in Shriram Finance will further strengthen its balance sheet. Additionally, the NBFC will benefit from the rate cuts. I am expecting that the NBFC's credit cost will go down significantly and NIMs will expand. This will ultimately have a positive impact on the profitability. So, Shriram Finance is a good stock to be in for medium to long term. The long term outlook is very positive," she said. Shriram Finance shares on Wednesday (Dec 24) closed 1.6 per cent higher at Rs 973.45 on BSE. The NBFC's market capitalisation stood at Rs 1,83,141.19 crore. VIDEO
Meanwhile, market analyst Manas Jaiswal said that Shriram Finance shares have rallied from the levels of Rs 600 to Rs 900 in the last three months. He advised against making fresh long positions at current levels, but added the every dip in Shriram Finance is an opportunity to accumulate.
"I would recommend wait for a decline in Shriram Finance. We may see a profit booking in Shriram Finance after the recent rally. Rs 880 to Rs 900 is a very good zone to buy for positional trade and my target on Shriram Finance is Rs 1050 to Rs 1100," the analyst said.
Shriram Finance is the flagship company of diversified conglomerate Shriram Group. The NBFC offers a wide range of products including commercial vehicle loans, MSME loans, tractors & farm equipment, gold loans, personal loans and working capital loans, across its 3,225 branches. It has 78,833 employees and serves 96.6 lakh customers.
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(Disclaimer: The above article is meant for informational purposes only, and should not be considered as any investment advice. ET NOW DIGITAL suggests its readers/audience to consult their financial advisors before making any money related decisions.)
