Aditya Birla Capital (ABCL), a financial service provider, continued its robust growth in business operation in 4QFY18 as well. The company’s consolidated revenue increased by 25%yoy and PAT jumped by 91%yoy to `208cr in said quarter. Consistent growth throughout the year took the company’s net profit for the FY18 to `824cr, up by 44%. Its business development was supported by an increase in lending business by all the segments of the company. The consolidated AUM rose by 24% to `3,05,295cr and simultaneously, loan book expanded by 32% to `51,378cr for the FY18.

Outlook & Valuation: We believe broad based and integrated financial offerings would enable ABCL to take benefit of financialisation of savings. We expect ABCL’s PAT to grow at CAGR of 47% over FY2018-20E, largely driven by Lending segment and AMC. We recommend a Buy rating on the stock, with a target price of `218.

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