ICICI Securities Assigns "Buy" On Midcap Stock With Attractive Valuation, Sees Up To 43% Gains

ICICI Securities places a "Buy" on Motilal Oswal Financial Services Ltd. with an attractive valuation of Rs 900/share. With the given target price, the stock can give up to 43% returns. This is a midcap company operating in the Financial Services sector having a market valuation of Rs 9,365.67/share. Below are key details:

Motilal Oswal's Current Market Price, 52 Week Low/High, Returns

The stock last traded at Rs 633.35/share, up 2.32% from the previous close of Rs 619/share. It hit the new 52 week low on 27 March 2023 at Rs 551.25/share, while the 52 week high hit on 29 April 2022 at Rs 960/share.

The stock gave 9.17% positive returns in 1 week and 4.19% in 1 month, respectively. However, in 1 year, it gave 30.16% negative return. In 3 years it gave 32.21% positive return. In 5 years it gave 38.33% negative return.

Attractive valuations - Buy for a target price of Rs 900/share

ICICI Securities said, "Motilal Oswal's (MOFSL) valuations have become attractive considering its trading at 5x FY24E core P/E multiple which excludes investment income and the investment book as well as high implied holding company discount of 45% basis current market capitalization and our assigned SOTP valuation multiples. Furthermore, the company's efforts towards improving its broking volume share and AMC performance, increasing wealth management (WM) AUM through expanding RM pool, and growing HFC portfolio sustainably and profitably, could potentially provide tailwinds to earnings."

It added, "Hence, we reiterate BUY with the target price unchanged at Rs900 based on FY24E SoTP valuations. We assign 12/15/15/5/5 times P/E on core PAT for broking and distribution / AMC / wealth management / PE&RE / investment banking, respectively. We assign 0.7/1.2 times P/B for capital market/affordable housing lending, respectively, and 1 time on fund-based H1FY23 AUM. We apply an overall holding company discount of 20%."

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