Shriram Finance reports a strong net profit in Q3
Shares of Shriram Finance Ltd reached a new high in early trade today following the company’s announcement of a robust net profit for the December 2023 quarter. The non-banking financial company (NBFC) reported a net profit of Rs 1818.3 crore, compared to Rs 1777 crore on a year-on-year basis. This impressive performance has greatly contributed to the surge in the company’s stock.
Shriram Finance stock gains momentum, hits record high
Shriram Finance stock experienced a significant surge, gaining 6.18% and reaching a record high of Rs 2448.85. This rise in stock price is noteworthy, especially considering the previous close of Rs 2306.15 on the Bombay Stock Exchange (BSE). The stock has seen a remarkable increase of 90.72% in the past year and 30.22% in the last six months.
Shriram Finance stock showcases stability and positive technical indicators
Despite its rapid growth, Shriram Finance stock has displayed consistent stability and positive technical indicators. With a beta of 0.4, the stock has witnessed minimal volatility over the past year. The relative strength index (RSI) of 65.8 indicates that the stock is currently neither overbought nor oversold. Additionally, the stock’s trading prices have consistently remained higher than the 5-day, 20-day, 30-day, 50-day, 100-day, and 200-day moving averages.
Net interest income surges, reflecting strong lending activities
Shriram Finance’s net interest income (NII), which represents the difference between interest income earned from lending activities and interest paid to depositors, increased by 17.1% to Rs 4,911 crore. This growth rate is compared to the corresponding quarter of the previous fiscal year, where the NII stood at Rs 4,192.1 crore. The significant surge in NII demonstrates the company’s strong lending activities and ability to generate substantial interest income.
Total assets under management experience significant growth
Shriram Finance witnessed a substantial increase in its total assets under management (AUM) at the end of the third quarter. The AUM surged by 20.70%, reaching Rs 214,233.47 crore compared to Rs 177,498.02 crore as of December 31, 2022. This highlights the company’s ability to attract more customers and manage a higher volume of assets effectively. The robust growth in AUM is a positive indicator for investors and reflects the company’s strong position in the market.
Dividend declaration and positive future outlook
The board of Shriram Finance declared an interim dividend of Rs 10 (100%) per share, with the record date for entitlement set as February 6, 2024. This announcement further reinforces the positive performance of the company and its commitment to rewarding shareholders. With its strong financial results, stable stock performance, and positive technical indicators, Shriram Finance is well-positioned for continued success in the future.
Analyst comment
1. Positive news: Shriram Finance reports a strong net profit in Q3.
Market prediction: The market is expected to respond positively to the news, resulting in an increase in the company’s stock price.
2. Positive news: Shriram Finance stock gains momentum, hits a record high.
Market prediction: The market is expected to continue the upward trend, leading to further gains in the company’s stock price.
3. Positive news: Shriram Finance stock showcases stability and positive technical indicators.
Market prediction: The market is likely to view the stock favorably due to its stability and positive technical indicators, resulting in sustained or further increases in stock price.
4. Positive news: Net interest income surges, reflecting strong lending activities.
Market prediction: The market is likely to interpret the surge in net interest income as a positive sign, leading to increased confidence in the company and potentially driving up its stock price.
5. Positive news: Total assets under management experience significant growth.
Market prediction: The market is expected to view the significant growth in total assets under management as a positive indication of the company’s performance and potential, resulting in increased investor interest and a potential rise in stock price.
6. Positive news: Dividend declaration and positive future outlook.
Market prediction: The market is likely to respond positively to the dividend declaration and positive future outlook, instilling confidence in investors and potentially driving up the company’s stock price.
