But if you see, sales have been growing consistently. Yes, the Market Share and Asset Quality issues are a bit concerning but that is what supposed to happen in a high Interest Rate scenario. Sales are good, In Mar22 Revenue was 10,000CR and now we are at TTM of 16,500Cr. This is huge. The stock price is in a time correction period. If you remember, during lockdown when SBICC got listed, the valuations were insane. It almost went 2x from IPO price. Now we are just seeing some Rationalization in the stock price.
Don’t get me wrong, I am also holding for the last 2 years and it has tested my patience as well but if the business is growing and the stock price and valuations are in a correction period, I would not stress so much about it. When the Rates go down and they will soon, we will see reduction in credit costs. This is automatically improve the Return Ratios and bottom line.
I will wait for the Interest Rate cuts to play out and their effect on the Financials. If even after the positive developments the results are not good, I will exit the stock.
Subscribe To Our Free Newsletter |