Rs 20/Share Dividend: Shriram Finance Hits Record High On 13% Rise In Q2 PAT; Buy?

The stock price of the non-banking financial company (NBFC) Shriram Finance saw an enormous rise of 6.66%, reaching a new all-time high of Rs 1,977.40 per share on Friday during trading. Following the company's Q2 PAT spike of 13% YoY during the quarter ended September 30, 2023, and the Board of Directors' declaration of an impressive dividend of 200%, the shares ended the day with an upside gap of 7.70% at Rs 1936.

Shriram Finance Dividend

The Board of Directors "Declared an interim dividend of 200% i.e. Rs.20/- per equity share of face value Rs.10/- each fully paid up for the Financial Year 2023-24, subject to deduction of tax at source, if any, to be paid to those members whose name appears in the Register of Members of the Company as on Monday, November 6, 2023 being the Record Date, for the purpose of payment of interim dividend. The interim dividend payout will be made to eligible shareholders on or before Saturday, November 25, 2023," said Shriram Finance in a stock exchange filing.

Shriram Finance Q2 Results

In Q2FY24, the company posted a consolidated net profit of Rs 1,792 crore, up 13% from Q2 FY23's Rs 1,578.56 crore. In Q2 FY24, the company's net interest income improved to Rs 4,969.39 crore, representing a YoY gain of 18.80% as against Rs. 4,183.02 crore in the same period of the previous year.. Meanwhile, the net interest margin jumped to 8.9%, indicating a year-on-year growth of 67 basis points. Compared to Rs 169,359.08 crore reported in Q2 FY23 and Rs 193,214.67 crore in Q1 FY24, its total assets under management climbed by 19.65% during the quarter under review to a total of Rs 202,640.96 crore. At Rs 8,564.45 crore, the total income for the quarter climbed 15.44% YoY. Consolidated earnings per share (basic) climbed by 12.93% to Rs. 47.61 from Rs. 42.16 during the same period last year.

Shriram Finance Share Price Target

Mandar Bhojane-Equity Research Analyst at Choice Broking said, "SHRIRAMFIN is presently trading at Rs 1960. On the weekly chart, a Rectangle breakout pattern has formed, with the price consolidating near a resistance level. If the price manages to close above Rs 1980, it is likely to experience further upward movement, with target levels at Rs 2160."

"Key technical indicators support this optimistic outlook. SHRIRAMFIN is currently trading above critical Exponential Moving Averages (EMAs), including the 20-day, 50-day, 100-day, and 200-day EMAs, signifying a bullish trend and suggesting the potential for continued upward price movement," the analyst stated.

"The Relative Strength Index (RSI) currently stands at 59.91 and is trending upwards, indicating increased buying momentum. These technical indicators collectively suggest that SHRIRAMFIN has the potential to reach a target price of Rs 2160 in the short term," the equity research analyst of Choice Broking said.

"To effectively manage risk and safeguard your investment, it is advisable to implement a stop-loss (SL) at Rs 1760. This stop-loss will serve as a safety net in case of an unexpected market reversal, ensuring that potential losses can be limited," Mandar Bhojane further added.

Disclaimer

The recommendations made above are by market analysts and are not advised by either the author, nor Greynium Information Technologies. The author, nor the brokerage firm nor Greynium would be liable for any losses caused as a result of decisions based on this write-up. Goodreturns.in advises users to consult with certified experts before making any investment decision.