Can MAS Financial Sustain Its Outperformance on Strong Growth Momentum?
MAS Financial Services (MFSL) has recently distinguished itself in the market, demonstrating robust growth and resilience. Here’s a closer look at its current standing and growth strategies.
– Strong Performance: MFSL has achieved a 9% increase in its stock price over the past month, outperforming the 2% rise in the BSE Financial Services index.
– AUM Goals: The company aims to reach ₹1,00,000 crore in consolidated assets under management (AUM) by 2036, a significant rise from ₹14,641 crore as of December 2025. This goal is supported by focused lending in lucrative segments, including MSME, vehicles, and housing.
– Analyst Confidence: Analysts have reiterated a ‘buy’ rating on the stock, adjusting the target price upwards by 7-9%. This is attributed to attractive valuations and favorable return ratios along with double-digit AUM growth.
Key Financial Highlights
– Double-Digit Growth: MFSL recorded double-digit growth rates for AUM, revenue, and net profit during the December 2025 quarter and for the first nine months of fiscal year 2026 (FY26).
– Cautious Approach: The management’s strategy emphasizes a careful approach to reviving loan demand, prioritizing asset quality and avoiding high-risk investments as it aims for an annual AUM growth of 30-35%. This approach is critical, given the rising trend in gross non-performing assets (GNPA), which has increased to 2.6%—up from 2.1% in June 2023.
Expansion and Market Reach
– Geographical Footprint: MFSL operates 208 branches across India, with nearly 88% located in four key states: Gujarat, Rajasthan, Madhya Pradesh, and Maharashtra.
– Diverse Loan Segments: On a standalone basis, the loan book of ₹13,782.3 crore comprises five segments—micro enterprises, SMEs, two-wheelers, commercial vehicles, and salaried personal loans. Notably, micro and SME loans make up three-fourths of this portfolio.
Future Projections
– Growth Aspirations: The management forecasts AUM growth between 20-25%, alongside a return on assets (RoA) of 2.75-3% in the medium-to-long term. The RoA for the December quarter was recorded at 2.9%.
– Funding Costs: Continued decline in borrowing costs is expected, with incremental costs of funds (CoF) projected between 9-9.25%, down from 9.5% last quarter. Further reductions of about 10 basis points may occur in March.
Conclusion: Sustaining Growth Momentum
As MAS Financial Services continues to streamline its operations and strategically target growth sectors, its ambition to increase AUM to ₹1,00,000 crore by 2036 appears within reach. With strong performance metrics, prudent management, and a diversified loan book, MFSL is well-positioned to sustain its outperformance amid market challenges. Investors and analysts alike remain optimistic about the company’s future trajectory, making it an intriguing option in today’s financial landscape.