Buy Max Financial Services, target price Rs 660: Emkay Global

Emkay Global has given a buy rating to Max Financial Services with a target price of Rs 660. The share price moved up by 12.30 per cent from its previous close of Rs 549.70. The stock’s last traded price is Rs 617.30.

Max Financial Services Ltd., incorporated in the year 1988, is a Mid Cap company (having a market cap of Rs 16673.18 Crore) operating in Financial Services sector.

Financials
For the quarter ended 30-06-2020, the company reported a Consolidated sales of Rs 5504.61 Crore, up 29.09 % from last quarter Sales of Rs 4264.06 Crore and up 39.40 % from last year same quarter Sales of Rs 3948.68 Crore Company has reported net profit after tax of Rs 181.53 Crore in latest quarter.

max-grph

Investment Rationale
Through a gradual shift toward profitable product mix and relatively comfortable valuations, the brokerage retains Buy (OW in Insurance EAP) and a revised TP of Rs 660 at 1.2x Sept’22E EV. The brokerage expects VNB to grow at a CAGR of 14.2% to Rs13.3bn over FY20-23E, with ROEVs at ~19.5% for FY20-FY23E


Promoter/FII Holdings
Promoters held 28.3 per cent stake in the company as of June 30, 2020, while FIIs held 30.5 per cent, DIIs 28.7 per cent and public and others 12.5 per cent.