Strong 1QFY27; Guidance reaffirmed, valuation remains supported

Research evidence excerpt

Strong 1QFY27; Guidance reaffirmed, valuation remains supported

(4QFY26: 3.6%, 1QFY26: 2.8%) Indian HY NBFCs: Trading levels

Growth guidance maintained amid stable demand, margins YTWAsk

Management maintained its FY27 AUM growth guidance of ~18%, although it plans to Bond Ask Px (%)

reassess the outlook after 2QFY27 once monsoon trends and rural demand become TATSON 5.389 28 100.6 5.1

clearer. Despite concerns around the Middle East tensions and weather-related SHFLIN 6.625 27 101.2 4.9

disruptions, management highlighted healthy vehicle utilization, strong CV demand and SHFLIN 6.15 28 101.3 5.3

MUTHIN 7.125 28 101.1 6.0

no meaningful stress across borrower segments, with operators largely able to pass MUTHIN 6.375 29 100.0 6.4

through higher fuel costs. The company reiterated its ~2% credit-cost guidance and MUTHIN 6.375 30 99.9 6.4

expressed increased confidence in MSME growth and asset quality, with both MSME and MUTHIN 5.75 30 97.9 6.4

gold loan portfolios expected to outgrow the overall book. Following the MUFG capital PIFINL 7.8 28 101.9 6.3

infusion, management indicated that targeted liability repayments have largely been MGFLIN 7.375 28 101.0 6.5

IIFOIN 8.75 28 103.1 7.0

completed and surplus liquidity will now be deployed toward growth. Near-term NIM is IIFOIN 7.6 29 100.5 7.4

expected to remain around current levels, supported by excess liquidity and lower IIFOIN 7.6 30 99.1 7.9

incremental borrowing costs, before gradually normalizing toward ~8.5% over the IHFLIN 9.7 27 103.5 5.8

medium term. IHFLIN 8.95 28 104.1 6.8

IHFLIN 7.5 30 101.3 7.1

Bond recommendations: We are Marketweight on SHFLIN bonds given fair value Source: BofA Global Research, Bloomberg

relative to peers on credit quality- and duration-adjusted basis. BofA GLOBAL RESEARCH