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Shares of Motilal Oswal Financial Services (MOFSL) hit a record high of Rs 2,185 as they rallied 5 per cent on the BSE in Friday's intraday trade after the company announced its maiden bonus issue plan.
The board of directors of MOFSL is scheduled to meet on April 26, 2024 to consider and approve audited financial results of the company for the quarter and year ended March 31, 2024. The company also said they will consider and approve a proposal for declaration of bonus shares, if any, subject to approval of the shareholders of the company.
Thus far in the calendar year 2024, the stock price of MOFSL has appreciated by 76 per cent as compared to 0.07 per cent decline in the S&P BSE Sensex. In the past one year, it has zoomed 257 per cent as against the 21.2 per cent rally in the benchmark index.
Motilal Oswal Group offers a diversified range of financial products and services such as retail broking and distribution, institutional broking, investment banking, asset management, private equity, wealth management, and housing finance.
In addition, the company also offers complementary in-house research and advisory services and margin trading facility. Motilal Group had over 7 million clients as of March 31, 2024 and had assets under management worth over Rs 4.4 trillion as of December 31, 2023.
The recent strong show by MOFSL shares was largely endorsed by the value discovery across its business segments of Capital Markets, Asset Management, Wealth Management, and Affordable Housing Finance in the backdrop of the current re-rating seen in listed peers in these specific segments.
"This substantiates our argument given in the initiation note that MOFSL value was going unnoticed due to its conglomerate structure and that its MOAT (reflected in its consistent book value compounding over 5-10-15 years) was not being aptly captured in its share price earlier," analysts at Emkay Global Financial Services said.
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The brokerage firm maintains its positive view on the stock and reiterates 'Buy' rating, with a revised March 2025 target price of Rs 2,200/share (from Rs 2,000 earlier).
MOFSL's businesses are centered on the three broad areas of Capital Markets, Asset & Wealth Management, and Housing Finance. 70 per cent of its consolidated net-worth in the form of treasury investments (Equity, MF, and alternates) is like a top-up to the value of its core businesses. While volatility is part and parcel of any equity-linked story, MOFS has built its business model around the economic MOATs of its brand, reach and people, and has diversified its offerings well to capture a large part of the customers’ wallet on their wealth creation journey, the brokerage firm said in its company report.
