Piramal Enterprises Shares Extend Loss For Second Session Despite Q1 Profit

Shares of Piramal Enterprises Ltd. dragged for the second consecutive session as major brokerages remained wary even as the company's first quarter net profit rose.

Citi maintained a 'sell' rating on the stock as Piramal reported a net profit of Rs 181 crore, which was below its estimate of Rs 230 crore.

The run-down in wholesale assets under management continued, decreasing by 11% quarter-on-quarter without any additional net credit costs. The recovery from alternative investment funds was relatively subdued at Rs 104 crore, significantly below the target of Rs 1,200 crore set for fiscal 2025.

Although the target price has been revised to Rs 800 from Rs 750, ongoing issues such as modest return on equity, persistent volatility, and the impact of merger transitions are expected to weigh on the company’s valuation, Citi said.

The non-banking financial company reported a 64% gain in its net profit at Rs 181 crore on a yearly basis for the first quarter, missing street expectations. This compares with the Rs 224-crore analysts' estimate tracked by Bloomberg.

The company's revenue fell by 26% year-on-year to Rs 2,145 crore. Analysts tracked by Bloomberg had pegged the top-line at Rs 1,260 crore.

Shares of the company fell as much as 8.12%, the lowest level since July 23, 2024, before paring loss to trade 7.6% lower at Rs 910.55 apiece, as of 10:00 a.m. This compares to a 0.02% decline in the NSE Nifty 50.

The stock has fallen 2.43% year-to-date. Total traded volume so far in the day stood at 1.43 times its 30-day average. The relative strength index was at 41.28.

Out of seven analysts tracking the company, one maintains a 'buy' rating, two recommend a 'hold' and four suggest 'sell', according to Bloomberg data. The average 12-month analysts' consensus price target implies a downside of 2.2%.