HSBC has maintained a positive outlook on the vehicle finance sector, highlighting that compared to segments like microfinance or housing finance, the vehicle finance space is expected to face manageable and fewer headwinds to earnings per share (EPS). The brokerage expects vehicle financiers to deliver stable EPS growth and profitability over FY25-27.
HSBC has maintained its ‘buy’ rating on Cholamandalam Finance stock and raised the target price to ₹1,610 from ₹1,510, reflecting confidence in the company’s growth potential. Additionally, HSBC expressed a constructive view on M&M Finance while highlighting that Sundaram Home Finance and Cholamandalam Finance remain the preferred picks in this space due to their robust business models and growth prospects.
Sector outlook:
HSBC’s positive stance on vehicle financiers is underpinned by the expectation of relatively stable growth and resilient profitability, making the sector attractive for investors looking for consistent returns. The brokerage remains optimistic about the long-term growth trajectory of key players in the segment.
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