Indostar Capital Finance - Diversified, Retail-Focused Business: Anand Rathi
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Anand Rathi Report
With a retail-focused strategy concentrating on higher-yield (used) vehicle financing. Indostar Capital Finance Ltd.’s diversified funding profile and strong asset and liability management framework gives it a strong profile.
Recently co-promoter Brookfield invested Rs 12.25 billion for ~57% equity shares, testimony to the company’s robust business model and which can act as a catalyst to raise further liquidity from banks.
Key risks -
- Retail segment not working as expected -the company used to be heavily into wholesale lending and has now shifted to retail businesses.
- Increase in non-performing assets - any unexpected increase in NPAs especially in the CV segment could lead to higher provisions and lower profitability.
- Change in government policies.
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