Hitesh, consider an opposite case.
Suppose they reduce dividend payout. What will happen? The growth rate won’t increase because they are not restricting growth for capital wants. What will really happen is leverage will come down. We need to remember Gruh is the most leveraged NBFC in India. RoA will increase a bit with reduced interest outgo. But with leverage down, their RoE will come down a lot. Their RoA is quite similar to many NBFCs, so will be RoE after reduced leverage. So valuation premium would contract.
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