PolicyBazaar Parent Shares Drop Despite Impressive Q4 Earnings: Why Brokerages Are Upbeat About The Fintech Stock

PB Fintech shares opened lower on Wednesday, despite the company, which owns Policybazaar, reporting a significant turn from a loss of ₹9.34 crore last year to a net profit of ₹60.19 crore for the fourth quarter of fiscal year 2024.

What Happened: The company saw its consolidated revenue increase by 25.36% to ₹1,089.57 crore compared to the previous year. The quarter's total insurance premium reached ₹5,127 crore, primarily driven by expansion in new health and life insurance segments.

The company’s cash position strengthened, rising by ₹259 crore year-on-year to ₹5,263 crore, fueled by a 39% growth in core online revenue, which totaled ₹2,375 crore. The adjusted EBITDA improved significantly, climbing to ₹324 crore from ₹107 crore, boosting the margin from 6% to 14%.

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Analyst Reactions: CITI retained a ‘Buy’ rating and raised its target price to ₹1,435 from ₹1,150, citing strong momentum in long-term earnings-per-share accretive segments and sustained growth through core channels. Citi noted continued improvement in EBITDA margins despite challenges in new business areas and stable margins at Paisa in line with guidance, alongside strong traction in the POSP business.

Morgan Stanley maintained an “Equal-weight” rating with a target price of ₹1,010, attributing the beat to robust insurance business growth. The firm highlighted a notable increase in adjusted EBITDA margins, though it pointed out weaker disbursement growth due to tighter credit supply. Morgan Stanley emphasized investor focus on the sustainability of premium momentum and a potential pickup in the credit business.

Price Action: PB Fintech shares were trading 2.22% lower at ₹1215.80 on Wednesday morning, shortly after bourses opened doors for trading.

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