More Stories

Informist, Thursday, Mar. 12, 2026

 

MUMBAI – Brokerage firm Nomura has initiated coverage on Piramal Finance Ltd., L&T Finance Ltd., and Tata Capital Ltd. with a 'buy' call on each. The brokerage has initiated coverage on HDB Financial Services Ltd. as well with a 'neutral' stance. The brokerage expects the four non-banking financial companies to deliver over 20% loan growth at a compound annual growth rate over the 2025–26 (Apr-Mar) to FY28 period. The sector is expected to see higher competition as lenders are focussing on product launches and market expansion. NBFCs are expected to grow faster than banks over the next 15 years and their share in the system credit is likely to rise to 33% by FY41, Nomura said in a research report.

 

Nomura has a target price of INR 2,150 on Piramal Finance, which it expects to deliver a return on equity in mid-teens over the medium term and thus sees a favourable current risk-reward. The brokerage firm also expects the company's credit costs to be stable. It expects Piramal Finance to clock a compounded annual growth rate of 28% in its retail assets under management over the FY26 to FY28 period with a scope to expand its branch-wise productivity. It expects overall assets under management to grow at a compounded annual growth rate of 26% over the same period. The brokerage's estimate for the company's assets under management for FY28 is in line with the management's guidance, it said in the report.

 

The retail segment makes up 82% of the non-banking financial company's loan-mix, while the wholesale book forms 12% of the total mix. A decline in the legacy book is expected to reduce pressure on its net interest margin and credit costs, the brokerage said. The brokerage expects Piramal Finance's legacy book to decline to slightly above 1% by FY28. The company has scaled down its exposure to real estate and other wholesale loans, which adds to the positive sentiment. Piramal Finance's usage of artificial intelligence is seen aiding its operations but lapses in its use or malfunctions pose downside risks, it noted.

 

Nomura has initiated coverage on L&T Finance with a target price of INR 325. A 36% upside in the company's share price is estimated if its loan growth rises by one percentage point over the base case, it said. Nearly 52% of the lender's loan mix is in volatile segments such as microfinance institutions, two-wheelers, and tractors. However, its portfolio behaved better than its peers, the brokerage said. Nomura's positive stance is also based on L&T Finance's aim to increase its retail loan portfolio, and it achieved a 98% retail loan mix in December 2025. The lender plans to expand its segments such as gold loans, micro loans against properties, and small and medium-sized enterprises, which helps expand its net interest margins further, Nomura said.

 

On Tata Capital, Nomura has set a target price of INR 400. An improvement in credit costs of motor and business loans, operating leverage, and entry into new higher-yielding products such as affordable housing and secured business loans are expected to expand the company's return on assets over the next three years, the brokerage said in its report. The company's return on assets is seen rising to 2.3% by FY28 from 1.7% in FY25. Tata Capital's Stage-3 loans deteriorated after its merger with Tata Motors Finance Ltd., and went beyond 2% in nine months ended December."...its asset quality trend is the best among other large diversified NBFCs in India," the brokerage said. However, changes in senior leadership of the company or its promoter Tata Group could impact its business strategy and earnings, the brokerage said. 

 

Nomura's target price for HDB Financial is INR 760. The company has a healthy market share in commercial vehicle and construction equipment loans, the brokerage said, with its share in loans against properties being similar to that of Tata Capital and Bajaj Finance. The lender's long-term instruments are rated 'AAA', and its capital adequacy ratio has risen over 20% since its listing on the bourses. These factors are seen supporting the company's aim to expand its consumer finance segment, Nomura said. However, HDB Financial's loan growth remains a concern for Nomura. "We believe a pickup in growth momentum is critical for stock re-rating," it said. The lower target multiple for the shares of the company is largely based on its slower loan growth momentum. The lender's loan book grew 12% on year in the nine months ended December, and its disbursements were flat, the brokerage highlighted. Meanwhile, margin expansion from further rate cuts poses an upside risk for HDB Financial, the brokerage said in its report.

 

	Stance	Target Price
Piramal Finance	Buy	INR 2,150
L&T Finance	Buy	INR 325
Tata Capital	Buy	INR 400
HDB Financial Services	Neutral	INR 760

 

End

 

Reported by Ruchira Kagita

Edited by Ashish Shirke

 

For users of real-time market data terminals, Informist news is available exclusively on the NSE Cogencis WorkStation.

 

Cogencis news is now Informist news. This follows the acquisition of Cogencis Information Services Ltd. by NSE Data & Analytics Ltd., a 100% subsidiary of the National Stock Exchange of India Ltd. As a part of the transaction, the news department of Cogencis has been sold to Informist Media Pvt. Ltd.

 

Informist Media Tel +91 (22) 6985-4000

Send comments to feedback@informistmedia.com

 

© Informist Media Pvt. Ltd. 2026. All rights reserved.