Five Star Business Finance rises 2% post block deal as 8.8% equity changes hands

Shares of Five Star Business Finance jumped nearly 2 percent in early trade on September 4, post a block deal where 8.8 percent of equity changed hands. At 10:49 am the Five Star Business stock was trading 1.38 percent higher at Rs 738.14 on NSE.

Details about the block deal

Foreign investors Norwest Venture Partners X – Mauritius, Matrix Partners India Investment Holdings II LLC, and TPG Asia VII SF Pte Ltd have collectively sold an 8.75 percent stake in mortgage lender Five-Star Business Finance on September 1.

Follow our live blog for all the market action

The sale of 2.55 crore shares amounted to a substantial Rs 1,862.86 crore. In contrast, HDFC Mutual Fund, through HTCL – HDFC Mid – Cap Opportunities Fund, acquired 41.19 lakh shares in Five-Star at an average price of Rs 730 per share, totaling Rs 300.7 crore.

Brokerage Views

Brokerage firm ICICI Securities has given a ‘buy’ rating to the Five-Star Business Finance stock with a target price of Rs 765 in a recently released report. The brokerage firm further stated that, “Five-Star Business Finance (Five-Star) is a direct play on the increasing formalisation of credit, especially in the small-ticket business loan segment.”

Brokerage firm Nomura has initiated coverage on Five-Star Business Finance with a “Buy” rating and set a price target of Rs 750 in a recently released report.

Shareholding Pattern

Public holds the majority of the stake in Five-Star Business Finance stock with 52.16 percent. Promoters and FIIs hold 34.39 percent and 8.74 percent stake respectively. DIIs hold the remaining 4.71 percent stake in the Five-Star Business Finance Non-Banking Financial Institution.

Stock Performance

Five-Star Business Finance stock has given a return 33.17 percent over the past six months. The benchmark Nifty Bank index has given a return of 7.48 percent over the same duration.

Disclaimer: The views and investment tips expressed by experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.