PB Fintech stock sees sharp recovery, up 82% in 2023 so far; is there more rally ahead?

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₹451 apiece to ₹821.40. Despite a subdued start in January with a 4.4% decline, the stock gained momentum from February onward, marking a substantial 30.26% increase. This positive trend has persisted into November, with the stock already registering a 17% uptick this month.

Also Read: Nykaa share price rises over 4% today, gains over 19% in last two weeks This rally stands in stark contrast to the stock's weak performance in CY22, during which it lost 53% of its value. The resurgence in the stock is primarily attributed to the company's strong financial performance. In the latest September quarter, the company showed signs of improvement, as its net loss narrowed to ₹21 crore from ₹187 crore in the same quarter of the previous year.

Its overall revenue from operations reached ₹812 crore in Q2, reflecting a 42% YoY increase. Also Read: Zomato vs Paytm: Which internet stock should you pick for long term? EBITDA margins improved from -39.4% (Q2 FY23) to -11.0% (Q2 FY24). This positive shift was fueled by prudent cost management measures, including reductions in ESOPs, controlled employee expenses, and advertising costs, resulting in significant operating leverage benefits.

Its renewal and trial revenue is at an ARR of ₹436 crore, up from ₹294 crore in the same quarter last year. Particularly, its core online business segment, Health & Term Insurance, witnessed an impressive 53% YoY growth in new premium during Q2 FY24, marking the highest performance in the last 7 quarters. Also Read: India ranks third among countries with most fintech unicorns in 2023 In light of the robust Q2 performance, domestic brokerage Keynote Capitals has maintained its 'buy' recommendation on the stock with a target price of ₹968 apiece.