Five-Star Business Finance - Healthy Performance; Outlook Remain Strong: Systematix

NDTV Profit’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer NDTV Profit’s subscribers an opportunity to expand their understanding of companies, sectors and the economy..Systematix Research Report.Five-Star Business Finance Ltd. Q3 FY24 operational performance was healthy and ahead of consensus estimates. Net interest income/operating profit came in-line at Rs 4.2 billion / Rs 3.0 billion (versus consensus estimate of Rs 4.3 billion / Rs 2.9 billion) registering a growth of 32% YoY (6% QoQ) / 46% YoY (8% QoQ). Net interest margins on AUM declined by 52 bps QoQ at 19.6%, mainly due to higher cost of funds (up 64 bps QoQ). AUM growth momentum was strong at 43% YoY (8% QoQ), even as disbursements were flat QoQ. Tamil Nadu and Andhra Pradesh together contribute ~68% of AUM and poor whether conditions in December 2023, impacted collection efficiency marginally (~1% QoQ. Overall asset quality was steady QoQ with gross stage-III asset ratio at 1.4% with coverage of ~54% (versus 50% in Q2). Management has maintained AUM growth guidance of 35% in FY24 with marginal moderation on account of regulatory changes, resulting in a slight impact on return on asset. At current market price, Five Star is trading at 3.8 times FY26 book value, we believe the premium valuation multiple compared with peers to sustain led by its unique position in the market, best in class RoA coupled with superior asset quality across cycles..Click on the attachment to read the full report:.Aavas Financiers Q3 Results Review - Trajectory Improving, But Still Some Way To Go: Motilal Oswal.DISCLAIMERThis report is authored by an external party. NDTV Profit does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of NDTV Profit..Users have no license to copy, modify, or distribute the content without permission of the Original Owner.

Five-Star Business Finance - Healthy Performance; Outlook Remain Strong: Systematix

At CMP, Five Star is trading at 3.8x FY26 book value, we believe the premium valuation multiple compared with peers to sustain led by its unique position in the market.

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Five-Star Business Finance - Healthy Performance; Outlook Remain Strong: Systematix

At CMP, Five Star is trading at 3.8x FY26 book value, we believe the premium valuation multiple compared with peers to sustain led by its unique position in the market.

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