Rs 16/Share Dividend: Record Date On 31st July, Will Be Paid On Or After 16th August; Buy The NBFC Stock?

Leading NBFC Sundaram Finance offers a comprehensive range of financial services and products through retail distribution, IT, mutual funds, housing finance, general insurance, and business process outsourcing. Since the final dividend for FY24 was announced, the large-cap NBFC company, which has a market value of Rs 50,489 Cr, has come into limelight. The closing price of Sundaram Finance's shares on Friday was Rs 4544.30, up 1.50%.

Sundaram Finance Dividend

"The Board of Directors has recommended a final dividend of Rs 16/- per share (160%) for the financial year ended 31st March 2024, on the paid-up capital of Rs 111.10 cr. This, together with the interim dividend of Rs 14/- per share (140%) paid on 1st March 2024 will make a total dividend of Rs 30/- per share (300%) for the financial year ended 31st March 2024. The register of members and share transfer books of the Company will remain closed from Thursday, the 1st August 2024 to Wednesday, the 14th August 2024 (both days inclusive) for the 71st Annual General Meeting and for considering the payment of final dividend. The dividend, if approved by the shareholders at the Annual General Meeting proposed to be held on 14th August 2024, will be paid on or after 16th August 2024 to those shareholders whose names appear on the Register of Members of the Company as on 31st July 2024," said the company in a regulatory filing.

Sundaram Finance Financials

In FY24, profit after tax increased by 23%, bringing net profit to Rs. 1,334 crores. A net profit of Rs. 1,088 crores was reported by the corporation during FY23. With a net profit of Rs. 386 crores in Q4FY24 compared to Rs. 316 crores in Q4FY23, profit after tax climbed by 22%. The FY24 disbursements showed a 25% increase to Rs. 26,163 crores from the Rs. 20,966 crores reported in the FY23. The amount disbursed in Q4FY24 climbed by 18% to Rs. 6,209 crores from Rs. 5,259 crores in Q4FY23.

As of March 31, 2024, the assets under management stood at Rs. 43,987 crores, up 27% from Rs. 34,552 crores as on 31st March 2023. In comparison to FY23, net interest income increased by 17% in FY24. Net interest income increased by 21% for the quarter that ended on March 31, 2024, compared to the same period in FY23. According to the RBI's revised asset categorization guidelines for NBFCs, the Gross and Net NPA are, as of March 31, 2023, 2.10% and 3.00%, respectively.

Compared to 34.26% in FY23, the cost-to-income ratio wrapped up at 34.69% in FY24. The Q4FY24's cost-to-income ratio was 33.46%, compared to Q4FY23's 33.02%. In comparison to FY23, when it achieved 2.84%, the company's Return on Assets (ROA) for FY24 was 3.18%. In FY24, return on equity (ROE) was 17.5%, compared to FY23's 14.9%. As of March 31, 2024, the Capital Adequacy Ratio was 20.5% (Tier I -16.8%) as opposed to 22.8% (Tier I - 17.7%) as of the same period in 2023.

Sundaram Finance Share Price Target

Mandar Bhojane - Equity Research Analyst at Choice Broking said, "SUNDARMFIN, currently trading at 4546 levels, is exhibiting a sideways trading pattern within the range of 4200 - 4800 for the past 2 months. This consolidation suggests a period of indecision or equilibrium in the market. The lower end of this range, around 4200, serves as a strong support level and aligns with the 50-Day Exponential Moving Average (EMA). This confluence enhances the significance of this support level, indicating a potential bounce when the price approaches it."

"There's a minor resistance observed near the upper end of the range, around 4800 levels. A successful breach of this resistance may pave the way for an upward movement towards the next resistance at 5440 levels. This presents a potential opportunity for traders. Currently, SUNDARMFIN is trading above its long term (200 Day) and Medium term (50 Day) EMA levels, signalling strength in its trend. The momentum indicator RSI is at 53 levels, indicating a neutral position. This suggests a balanced market sentiment without a clear bias towards overbought or oversold conditions. For investors holding from lower levels, it's advisable to trail their stop loss at the lower end of the range, around 4200. This approach helps protect gains while allowing for potential upside," the analyst recommended.