Aditya Birla Capital (AB Capital) stock is in focus after Jefferies and Macquarie shared their views on the financial services firm, highlighting a potential 50% upside. Analysts cite rising margins, growth in unsecured loans, and favorable valuations as key drivers for the company’s performance in the coming years.
Macquarie on AB Capital
- Rating: Outperform
- Target Price: ₹260
- Key Insights:
- AB Capital remains a top pick, expected to double in three years.
- Recent stock underperformance presents an opportunity for investors.
- Growth in higher-yielding unsecured loans and declining credit costs are expected to drive higher return on assets (RoA).
- Current valuations provide strong support for further upside.
Jefferies on AB Capital
- Rating: Buy
- Target Price: ₹248
- Key Insights:
- Risk-reward appears favorable at current levels.
- Unsecured loan growth is improving, and own sourcing is expected to rise gradually.
- Margins expected to stabilize, with product mix changes aiding net interest margin (NIM) expansion.
- Management expects credit costs to remain range-bound, with stress in unsecured loans peaking.
Stock Outlook
With both Jefferies and Macquarie maintaining a bullish stance, the stock remains a key watch for market participants, especially with expectations of improved profitability and higher RoA in the coming years.
Disclaimer
This news is for informational purposes only and does not constitute financial or investment advice. Investors should conduct their own research before making any investment decisions.
