Brokerage firm Geojit has given a "buy" call on the stock of Motilal Oswal Financial Services (MOSL) in its latest report. The company is a reputed financials services company with presence in broking, wealth management, housing finance, asset management, lending against securities etc. Here are 9 reasons to buy the stock according to brokerage firm Geojit.
Market share increases despite tough competition
According to Geojit, the company in FY21 ended reported total income of Rs 3626 crore-growth of 54 per cent over FY20. The net profit increased to Rs 1245 crore in FY21 as compared to Rs 183 crore of FY 20. "Despite tough competition in the broking industry, MOSL could increase its active clients and market share. The revenue market share in the broking industry increased to 2.7 per cent as compared to 2.4 per cent of FY20," the brokerage has said.
Company could do well in the June quarter
According to Geojit, the broking industry would see consolidation due to higher compliance costs and falling brokerage rates, helping established players like MOSL to gain market share. "The buoyant market condition does suggest that the company should do well in the first quarter of June 2021 too," the brokerage says.
Wealth business to benefit topline
Geojit believes the company is focussing on the wealth business, which believe should help the company to expand top line as well as the bottom line.
Housing finance boost
"The housing finance business was struggling a few years back, but now it's gaining strength. It reported the highest NIM. The management has guided that they will be able to maintain a lower cost of borrowings," Geojit has said in its report.
Insurance distribution to aid profits
According to the broking firm, the company has entered insurance distribution business which should help the company to report higher profit growth.
Healthy promoters stake
The promoters stake stands at a healthy 70.66 per cent while both FIIs, as well as DIIs, have increased stake in the company for March 2021 quarter as compared to December 2020 quarter. Geojit has noted.
Stock market is booming
According to the brokerage house, MOSL is a good proxy to ride a boom in the stock market as most of its businesses are dependent on the good sentiments of the market
The company is managed by two renowned personalities-Motilal Oswal and Raamdeo Agrawal, Geojit has noted.
Healthy ROE and Technical indicators bullish
Geojit has said that the company enjoys healthy ROE of 38 per cent and technical indicators are suggesting the bullish trend.
Views mentioned herein are taken from the brokerage report of Geojit. Neither the author, nor the brokerage nor Greynium Information Technologies would be responsible for losses incurred based on the article. Please consult a professional advisor. Investing in stock markets is risky.