Poonawalla Fincorp shares rose nearly 8% on October 12, 2026, after Motilal Oswal set a target price of ₹570. The brokerage highlighted strong AUM growth and profit improvements in the recent quarter, though other analysts remain cautious about the stock's long-term performance.
Poonawalla Fincorp shares gained nearly 8% on October 12, 2026, trading in the ₹460–₹484 range following a positive outlook from brokerage firm Motilal Oswal. The brokerage reiterated its 'Buy' rating on the non-banking financial company (NBFC) with a target price of ₹570, citing strong expansion in its loan book and operational efficiency.
The optimism follows the company’s recent second-quarter results for the 2027 fiscal year, where it reported a significant jump in profit to ₹375 crore, up from ₹74 crore in the same period a year ago. The company’s total loan book, or Assets Under Management (AUM), reached ₹74,008 crore as of September 30, 2026, reflecting a sharp year-on-year growth of 55.1%. Asset quality also showed signs of improvement, with Gross Non-Performing Assets (GNPA) dropping to 1.20% from 1.37% in the previous quarter.
Motilal Oswal’s analysis points to strong net interest margins and consistent asset growth as key drivers for the firm’s future performance. The brokerage expects this momentum to continue, supporting their bullish target. However, the market sentiment remains divided. Not all analysts share this optimistic view. For instance, Emkay Global has maintained a 'Reduce' rating on the stock with a target of ₹410, signaling caution among some market observers regarding the company’s ability to sustain this performance.
Investors should note that while the company is scaling up, it is also investing heavily in technology, collections, and new branch infrastructure. This has led to an increase in operating expenses, with the opex-to-AUM ratio rising to 4.15%. While these investments are meant to support long-term growth, they also exert pressure on margins.
Furthermore, despite the recent stock rally, Poonawalla Fincorp has experienced significant volatility over the past 12 months. Financial stocks in the NBFC sector also face broader risks, such as changes in interest rates, credit demand fluctuations, and potential shifts in regulatory requirements. Investors may monitor how the company manages its rising operational costs and whether it can maintain its improved asset quality in the coming quarters.