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M&M Finance jumps 12% after strong Q2 update; brokerages remain bullish

New Delhi: Shares of Mahindra & Mahindra Financial Services surged more than 12 per cent in early trade on Tuesday after the company provided a strong update for the September quarter.

In an exchange filing, the non-banking financial services (NFBC) firm said that its business continued its momentum with a disbursement of about Rs 4,080 crore, delivering a 110 per cent yearly growth.

The company disbursed loans worth Rs 21,300 crore, registering a growth of 106 per cent in the first half of the ongoing fiscal, compared to the previous one. The company clocked a growth of 82 per cent in the Q2FY23 over Q2FY22, it said.

“The company gross asset book moved close to Rs 73,900 crore, growing 3 per cent on a monthly basis, during the first half, led by strong disbursement trends,” the filing added.

Following the announcement, shares of Mahindra & Mahindra Finance rallied over 12 per cent to Rs 201.7 on Tuesday before correcting to Rs 196.75 at 9.55 am. The scrip had settled at Rs 179.55 on Monday.

Furthermore, the collection efficiency of the company improved to 98 per cent for September 2022, which was 96 per cent in August 2022.

Global brokerage firm Morgan Stanley remains overweight on Mahindra & Mahindra Financial Services with a target price of Rs 225 on the stock after its September quarter update.

“Asset quality and AUM numbers were much stronger than expectations,” it said. “Assessment is that this will be manageable without any material.”

Among other brokerage firms Investec has a hold rating on the company with a target price of Rs 235, whereas Sharekhan has pegged the counter at Rs 275 with a buy call for the NBFC.

(Disclaimer: Recommendations, suggestions, views, and opinions given by the experts are their own. These do not represent the views of Economic Times)

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