Stock Market Update: Manba Finance made a remarkable debut on the BSE and NSE, listing at a significant 25% premium to its upper price band of ₹120 per share. On Monday, the shares opened at ₹150 on the BSE and ₹145 on the NSE, showcasing strong investor interest from the start. The stock further climbed to an intraday high of ₹152.25 on the NSE, experiencing a notable 5% gain shortly after listing and quickly hitting the upper circuit limit.
Overview of Manba Finance
Manba Finance Ltd. specializes in providing loans for two-wheelers and Micro, Small, and Medium Enterprises (MSMEs). With ambitious plans to capture 65% of the two-wheeler loan segment and 35% of the MSME loan market, the company is well-positioned for growth. Market analysts advise that investors looking for long-term gains should consider holding the stock, while those with a shorter investment horizon might want to book profits, particularly as prices are projected to approach around ₹160.
Manba Finance Share Price Outlook
Arun Kejriwal, founder of Kejriwal Research and Investment Services, indicated that Manba Finance is categorized as a trade-to-trade stock, which suggests it may exhibit significant price movements but will also be locked into circuit limits during its initial trading sessions. The projected fair value for the stock is around ₹160, prompting Kejriwal to recommend that short-term investors consider taking profits around this price target.
Industry Growth and Future Prospects
According to Akriti Mehrotra, a Research Analyst at StoxBox, the Indian Non-Banking Financial Company (NBFC) sector is set for substantial growth, particularly in two-wheeler, three-wheeler, and MSME lending. The increase in finance penetration and consumer demand is expected to drive this growth, and with NBFCs projected to capture a significant market share, Manba Finance is strategically positioned to benefit. The company reported impressive growth in Assets Under Management (AUM), which increased at a compounded annual growth rate (CAGR) of 37.5% from FY22 to FY24, reaching ₹9,368.6 million, alongside a rise in profit after tax to ₹314.2 million. Their expansive reach across six states and more than 1,100 dealers enhances their market presence, including offerings in personal, business, and used car loans.
Investment Recommendations
Experts from StoxBox recommend that investors who have received allocations of Manba Finance shares should adopt a medium to long-term holding strategy. The company is experiencing improvements in Return on Capital Employed (RoCE) margins, a reduction in Non-Performing Assets (NPAs), and ongoing expansion initiatives, strengthening its case as a favorable investment option.
