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Thursday, June 13, 2024

What Should Investors Do Now After the 10% Drop in the PB Fintech Stock Over Two Sessions?


<p>The shares of PB Fintech fell over 10% in the two sessions after its June quarter results, which showed that the business decreased its year-over-year (YoY) losses. Shares of the company were under pressure on Wednesday for the second straight day.</p>
<p>On the NSE today, the stock decreased 5% during intraday trading to reach the day’s low of Rs 720.<img decoding=”async” class=”alignnone wp-image-120410″ src=”https://www.theindiaprint.com/wp-content/uploads/2023/08/theindiaprint.com-ex-cm-of-bengal-buddhadeb-bhattacharya-gets-released-from-the-hospital-download-2023-08-09t181418.942.jpg” alt=”theindiaprint.com ex cm of bengal buddhadeb bhattacharya gets released from the hospital download 2023 08 09t181418.942″ width=”1330″ height=”745″ srcset=”https://www.theindiaprint.com/wp-content/uploads/2023/08/theindiaprint.com-ex-cm-of-bengal-buddhadeb-bhattacharya-gets-released-from-the-hospital-download-2023-08-09t181418.942.jpg 300w, https://www.theindiaprint.com/wp-content/uploads/2023/08/theindiaprint.com-ex-cm-of-bengal-buddhadeb-bhattacharya-gets-released-from-the-hospital-download-2023-08-09t181418.942-150×84.jpg 150w” sizes=”(max-width: 1330px) 100vw, 1330px” title=”What Should Investors Do Now After the 10% Drop in the PB Fintech Stock Over Two Sessions? 9″></p>
<p>The firm that owns PolicyBazaar and Paisabazaar, PB Fintech, released data for the June quarter in which its net loss decreased from the same period last year. Additionally, compared to previous year, it recorded an operational profit.</p>
<p>Operating revenue for the fintech increased 32% YoY to Rs 666 crore during the reporting period. In the same quarter of the previous year, it was Rs 505 crore.</p>
<p>For the first quarter, the consolidated adjusted EBITDA was positive by Rs 23 crore, compared to a negative Rs 66 crore for the same period previous year.</p>
<p>What Investors Need to Know</p>
<p>Kotak suggested a “Add,” claiming that the Policybazaar company is still on track to become profitable and meet its stated expectations. It said that although the new efforts showed a slowdown, the core business was still on pace. The management concentrated on reducing losses in these divisions. The brokerage said in a report that “we are not writing-off new initiatives and expect a pick-up over time.”</p>
<p>With an underweight rating, brokerage company Macquarie has started covering PB Fintech Ltd. The company thinks that the risks associated with Bima Sugam, which has the potential to be a disruptive force, are being understated by the market.</p>
<p>A one-stop shop electronic insurance platform called Bima Sugam is promoted as being similar to an e-commerce platform.</p>
<p>On PB Fintech, Macquarie has a price objective of Rs 560, which represents a possible decline of 26% from Tuesday’s closing levels.</p>
<p>In order to get at a DCF-based target price of Rs 720, Nuvama advised a ‘Hold’ recommendation on the stock, further lowering its cost of equity assumption to 13% and moving the target date ahead to September 2024E. It was said that the current business was stable and that new efforts were becoming more profitable. As premium throughput dropped to 23.9% YoY, PB Fintech posted a robust set of figures for the June quarter, mostly driven by excellent operational leverage, according to Nuvama.</p>
<p>In a note, it said, “We raise our FY24E/25E adj. EBITDA estimates by (13.1%)/137.7%.”</p>


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