Nice writeup. I believe all state government's will end up with Ladli Behena and other populist schemes targeting rural voters which will help MFI players.
Thanks for the comment! I also think Ujjivan SFB is a good buy at the moment. Comparison between Ujjivan and CreditAcess:
1) higher average interest rate (23% vs 21%)
2) higher cost-to-income ratio (60% vs 30%) , showing that creditaccess is more cost efficient
3) similiar GNPA and CRAR - both are pretty conservative in lending
4) similiar 5-yr average ROE (13% vs 12%)
5) lower 5-yr average growth (16% vs 25%)
6) lower PE (6 vs 10) and PB currently (1.1 vs 1.9)
Hence, purely looking at financials, Ujjivan looks like a better deal. However , i think CreditAccess has a clearer competitive advantage (low cost loans with the widest network). So, I think it has a better growth runway than Ujjivan. So, over long term, it is a better bet. That being said, even Ujjivan looks attractive at the moment.
Nice writeup. I believe all state government's will end up with Ladli Behena and other populist schemes targeting rural voters which will help MFI players.
Ujjivan might be a better bet, perhaps the best in the sector given its current P/B of 1.1. Thoughts?
Thanks for the comment! I also think Ujjivan SFB is a good buy at the moment. Comparison between Ujjivan and CreditAcess:
1) higher average interest rate (23% vs 21%)
2) higher cost-to-income ratio (60% vs 30%) , showing that creditaccess is more cost efficient
3) similiar GNPA and CRAR - both are pretty conservative in lending
4) similiar 5-yr average ROE (13% vs 12%)
5) lower 5-yr average growth (16% vs 25%)
6) lower PE (6 vs 10) and PB currently (1.1 vs 1.9)
Hence, purely looking at financials, Ujjivan looks like a better deal. However , i think CreditAccess has a clearer competitive advantage (low cost loans with the widest network). So, I think it has a better growth runway than Ujjivan. So, over long term, it is a better bet. That being said, even Ujjivan looks attractive at the moment.