--Maintain Overweight (Assume Coverage)| Target Rs 320 (from 235)| LTP Rs 266| Upside 20%
The firm believes M&M Financial is well-positioned to capitalize on positive rural momentum, which could drive its growth in the upcoming quarters. The company's Return on Assets (ROA) has stabilized within a reasonable range of 1.8-2%.
Additionally, Net Interest Margins (NIMs) are expected to improve due to a favorable interest rate cycle, stronger core fee income, and a robust tractor cycle. Significant improvements in flow rates were observed in Q3, indicating healthier asset quality.
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